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ORIGINAL 

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6.1 

3/JS~ 


AMERICAN  SUMATRA  TOBACCO  COMPANY 


TO 

THE  CHASE  NATIONAL  BANK  OF  THE  CITY  OF 

NEW  YORK, 

as  Trustee 


Jttbenlurr 

Dated  June  1,  1920 


$6,564,000 

FIVE-YEAR  SEVEN  AND  ONE-HALF  PER  CENT.  SINKING  FUND 
CONVERTIBLE  GOLD  NOTES. 


The  Evening  Post  .lob  Printing  Office.  Tnc..  156  Fulton  St.,  N.  Y. 


Digitized  by  the  Internet  Archive 
in  2017  with  funding  from 

University  of  Illinois  Urbana-Champaign  Alternates 


https://archive.org/details/americansumatrat00amer_0 


QJljtfi  3lttllntttU*P,  dated  the  first  day  of  June,  in  the 
year  nineteen  hundred  and  twenty,  between  American 
Sumatra  Tobacco  Company,  a  corporation  organised 
and  existing  under  the  laws  of  the  State  of  Georgia  (here¬ 
inafter  called  the  'Company),  party  of  the  first  part,  and 
The  Chase  National  Bank  of  the  City  of  New  York, 
a  corporation  organized  and  existing  under  the  laws  of 
the  United  States  of  America  (  hereinafter  called  the  Trus¬ 
tee) ,  party  of  the  second  part : 

Whereas  the  Company,  for  its  corporate  purposes,  by 
appropriate  resolutions  of  its  Board  of  Directors  duly 
adopted  has  determined  to  issue  its  Notes,  both  coupon 
and  registered,  substantially  in  the  forms  hereinafter 
recited,  limited  to  the  principal  amount  of  $0,564,000,  at 
any  one  time  outstanding,  to  be  known  as  its  Five-Year 
Seven  and  One-half  Per  Cent,  Sinking  Fund  Convertible 
Gold  Notes,  to  be  payable  June  1,  1925,  to  bear  interest 
at  the  rate  of  seven  and  one-half  per  centum  per  annum, 
payable  semi-annually  on  the  first  day  of  June  and  the 
first  day  of  December  in  each  year,  to  be  payable 
both  as  to  principal  and  interest  at  the  office  of  the 
Trustee,  in  the  Borough  of  Manhattan,  in  the  City  of 
New  York,  in  gold  coin  of  the  United  States  of  America 
of  or  equal  to  the  standard  of  weight  and  fineness  as  it 
existed  on  June  1,  1920,  and  both  as  to  principal  and 
interest  without  deduction  for  any  tax  or  taxes,  assess¬ 
ments  or  other  governmental  charges  (other  than  inheri¬ 
tance  taxes  and  federal  excess  profits  and  income  taxes 
in  excess  of  2%  per  annum)  which  the  Company 
or  the  Trustee  may  be  required  or  permitted  to  pay 
(hereon  or  to  retain  therefrom,  under  any  present  or 
future  law  of  the  United  States  of  America,  or  of  any 
state,  county,  municipality  or  other  lawful  taxing 
authority  therein,  to  be  redeemable,  in  whole  or  in  part, 


in  the  manner  and  at  the  prices  hereinafter  provided,  to 
be  convertible  into  the  common  stock  of  the  Company 
during  the  periods  and  upon  the  terms  hereinafter  set 
forth  and  to  be  entitled  to  the  benefit  of  the  sinking  fund 
hereinafter  mentioned ;  and 

Whereas,  in  further  pursuance  of  said  resolutions  of 
its  Board  of  Directors,  for  the  purpose  of  securing  the 
payment  of  said  Notes  and  the  interest  thereon,  and  the 
observance  and  performance  of  the  covenants  and  condi¬ 
tions  herein  and  in  said  Notes  contained,  the  Company 
has  determined  to  execute,  acknowledge  and  deliver  to 
the  Trustee  an  indenture  substantially  in  the  form  of 
this  Indenture;  and 

Whereas,  the  forms  (so  approved  by  its  Board  of 
Directors)  of  the  coupon  Notes  for  f 1,000  and  of  the 
coupons  to  be  attached  thereto  (form  of  coupon  Notes 
of  other  denominations  and  of  appurtenant  coupons  to 
be  of  like  tenor,  except  as  to  amount)  and  of  the  regis¬ 
tered  Notes  without  coupons  and  of  the  Trustee's  cer¬ 
tificate  to  be  endorsed  on  all  said  Notes,  severally  and 
respectively,  are  to  be  substantially  as  follows,  to-wit: 

[FORM  OF  $1,000  COUPON  NOTE.] 

No.  $1,000 

UNITED  STATES  OF  AMERICA 

State  of  New  York 

AMERICAN  SUMATRA  TOBACCO  COMPANY. 

Five-Year  Seven  and  One-Half  Per  Cent.  Sinking  Fund 
•  Convertible  Gold  Note. 

American  Sumatra  Tobacco  Company,  a  Georgia  cor¬ 
poration  (hereinafter  called  the  Company),  for  value 
received,  hereby  promises  to  pay  to  the  bearer  (or,  if 


3 


this  note  be  registered,  to  the  registered  holder  hereof), 
on  the  first  day  of  June,  1925,  at,  the  office  of  the  Trustee 
hereinafter  mentioned,  in  the  Borough  of  Manhattan,  in 
the  City  and  State  of  New  York,  the  sum  of  one  thousand 
dollars,  in  gold  coin  of  the  United  States  of  America,  of 
or  equal  to  the  standard  of  weight  and  fineness  as  it 
existed  on  June  1,  1920,  and  to  pay  interest  thereon  from 
June  1,  1920,  in  like  gold  coin,  at  the  rate  of  seven  and 
one-half  per  cent,  per  annum,  at  said  office  semi-annually 
on  the  first  day  of  June  and  the  first  day  of  December  in 
each  year,  but  only  upon  presentation  and  surrender  of 
the  coupons  hereto  annexed  as  they  shall  severally 
mature. 

Both  the  principal  and  interest  of  this  note  are  pay¬ 
able  without  deduction  for  any  tax  or  taxes,  assessments 
or  other  governmental  charges  (other  than  inheritance 
taxes  and  federal  excess  profits  and  income  taxes  in 
excess  of  2%  per  annum)  which  the  Company  or  the 
Trustee  may  be  required  or  permitted  to  pay  thereon  or 
to  retain  therefrom  under  any  present  or  future  law  of 
the  United  States  of  America,  or  of  any  state,  county, 
municipality  or  other  lawful  taxing  authority  therein. 

This  note  is  one  of  a  duly  authorized  issue  of  coupon 
notes  and  registered  notes  of  the  Company,  limited  to 
the  principal  amount  of  |6,5G4.000  at  any  one  time  out¬ 
standing,  known  as  Five-Year  Seven  and  One-half  Per 
Cent.  Sinking  Fund  Convertible  Gold  Notes,  issued  and 
to  be  issued  under  an  Indenture,  dated  June  1,  1920, 
executed  by  the  Company  to  The  Chase  National  Bank 
of  the  City  of  New  York,  as  Trustee,  to  which  reference 
is  hereby  made  for  a  statement  of  the  rights  of  the  holders 
or  registered  owners  of  the  notes  issued  thereunder,  to 
all  the  provisions  whereof  the  holder  or  registered  owner 
hereof,  by  acceptance  of  this  note,  assents.  Except  as 
provided  in  said  Indenture,  all  rights  of  action  on  this 
note  and  the  coupons  hereto  appertaining  are  vested 
exclusively  in  the  Trustee. 

The  notes  of  said  issue- are  subject  to  redemption,  in 
whole  or  in  part,  at  the  option  of  the  Company,  at  any 
time,  on  at  least  sixty  days’  prior  notice  by  publication, 
as  provided  in  said  Indenture,  at  one  hundred  and  five 


4 


per  cent.  (105%)  of  the  face  value  thereof,  if  redeemed 
on  or  prior  to  June  1,  1921;  at  one  hundred  and  four 
per  cent.  (104%)  of  the  face  value  thereof,  if  redeemed 
thereafter  and  on  or  prior  to  June  1,  1922;  at  one  hun¬ 
dred  and  three  per  cent.  ( 103% )  of  the  face  value  thereof, 
if  redeemed  thereafter  and  on  or  prior  to  June  1,  1923; 
at  one  hundred  and  two  per  cent,  (102%)  of  the  face 
value  thereof,  if  redeemed  thereafter  and  on  or  prior  to 
June  1,  1924;  and  at  one  hundred  and  one  per  cent. 
(101%)  of  the  face  value  thereof,  if  redeemed  thereafter 
and  prior  to  June  1,  1925,  in  each  case  together  with 
accrued  interest.  The  notes  are  subject  to  like  redemp¬ 
tion  by  operation  of  the  sinking  fund  provided  for  in 
said  Indenture. 

At  the  option  of  the  holder  or  registered  owner  this 
note  may  be  converted  at  its  face  value  at  any  time  on  or 
after  October  1,  1920,  on  the  conditions  and  regulations 
prescribed  in  said  Indenture  (except  when  the  books  for 
the  transfer  of  the  common  stock  of  the  Company  are 
closed  as  permitted  by  said  Indenture,  and  except  that  in 
the  case  of  notes  called  for  redemption  the  right  of  con¬ 
version  shall  expire  ten  days  prior  to  the  date  fixed  for 
redemption)  into  shares  of  the  common  stock  of  the  Com¬ 
pany,  as  its  common  stock  shall  be  constituted  at  the  time 
of  such  conversion,  at  the  rate  of  nine  and  one-half  shares 
of  such  stock  for  a  $1000  note  at  any  time  on  or  after 
October  1,  1920,  and  up  to  and  including  December  31, 
1921,  and  thereafter  at  the  rate  of  nine  shares  of  such 
stock  for  a  $1000  note,  unless  common  stock  of  the  Com¬ 
pany  in  addition  to  the  amount  thereof  outstanding  on 
June  1,  1920,  be  issued  or  sold  (other  than  common  stock 
issued  on  conversion  and  stock  dividends  in  amounts  per¬ 
mitted  by  said  Indenture)  in  which  case  the  conversion 
price  shall  be  determined  as  in  said  Indenture  provided, 
and  with  an  adjustment  of  accrued  interest  and  divi¬ 
dends,  as  well  as  any  balance  of  principal  as  between  this 
note  and  the  stock  into  which  the  same  shall  be  con¬ 
verted  which  may  be  paid  to  the  holder  or  registered 
owner  on  conversion,  all  in  accordance  with  the  provi¬ 
sions  of  said  Indenture.  The  Company  shall  not  be  re¬ 
quired  to  issue  a  fraction  of  a  share  on  any  such  con¬ 
version. 


5 


In  case  an  event  of  default  as  defined  in  said  Inden¬ 
ture  shall  happen,  the  principal  of  the  notes  may  become 
or  be  declared  due  and  payable  in  the  manner  and  with 
the  effect  provided  in  said  Indenture. 

This  note  shall  pass  by  delivery  unless  registered  in 
the  name  of  the  owner  at  the  office  of  the  Trustee  in  said 
Borough  of  Manhattan,  City  of  New  York,  such  registra¬ 
tion  being  noted  hereon.  After  such  registration,  no 
transfer  shall  be  valid  unless  made  at  said  office  by  the 
registered  owner  in  person  or  by  attorney  duly  author¬ 
ized  and  similarly  noted  hereon ;  but  this  note  may  be 
discharged  from  registration  by  being  in  like  manner 
transferred  to  bearer,  and  thereupon  transferability  by 
delivery  shall  be  restored;  and  this  note  may  again,  from 
time  to  time,  be  registered  or  transfenred  to  bearer  as 
before.  Such  registration,  however,  shall  not  affect  the 
negotiability  of  the  coupons,  which  shall  continue  to  be 
payable  to  bearer  and  transferable  by  delivery  merely. 

The  holder  of  a  coupon  note  or  notes  of  the  denomina¬ 
tion  of  f 1,000,  at  his  option,  may  surrender  the  same  for 
cancellation,  with  all  unmatured  coupons  thereto  apper¬ 
taining,  in  exchange  for  a  registered  note  or  notes  with¬ 
out  coupons,  as  provided  in  said  Indenture,  and  on 
payment,  if  the  Company  shall  require  it,  of  the  charges 
therein  provided  for.  In  like  manner  and  upon  like 
terms,  any  registered  note  may  in  turn  be  exchanged  for 
a  coupon  note  or  coupon  notes  of  the  like  aggregate  prin¬ 
cipal  amount  as  provided  in  said  Indenture. 

A  Noteholders  Committee  is  appointed  in  and  by  said 
Indenture  with  such  rights  and  powers  to  waive  defaults 
and  covenants  of  the  Company  and  to  otherwise  act,  as 
are  therein  specified. 

No  recourse  shall  be  had  for  the  payment  of  the  prin¬ 
cipal  of  or  interest  upon  this  note  or  any  part  thereof, 
or  for  any  claim  based  hereon  or  otherwise  in  respect 
hereof  or  of  the  indebtedness  represented  hereby  or  by 
the  coupons  appertaining  hereto  or  of  said  Indenture, 
against  any  incorporator,  stockholder,  officer  or  director, 
as  such  or  otherwise,  past,  present  or  future,  of  the  Com¬ 
pany  or  of  any  successor  corporation,  either  directly  or 
through  the  Company  or  any  successor  corporation, 
whether  by  virtue  of  any  constitutional  provision,  statute, 


6 


or  rule  of  law  or  by  the  enforcement  of  any  assessment  or 
otherwise,  all  such  liability  being  by  the  acceptance  hereof 
and  as  part  of  the  consideration  hereof  expressly  re¬ 
leased,  as  provided  in  said  Indenture. 

This  note  shall  not  be  valid  or  become  obligatory  for 
any  purpose  until  it  shall  have  been  authenticated  by  the 
Certificate  of  the  Trustee  under  said  Indenture  hereon 
endorsed. 

In  witness  whereof,  American  Sumatra  Tobacco 
Company  has  caused  this  note  to  be  signed  in  its  name  by 
its  President  or  one  of  its  Vice-Presidents  and  its  cor¬ 
porate  seal  to  be  hereunto  affixed  and  to  be  attested  by  its 
Secretary  or  one  of  its  Assistant  Secretaries,  and  coupons 
for  said  interest  to  be  attached  hereto,  bearing  the  fac¬ 
simile  signature  of  its  Treasurer,  all  as  of  the  first  day 
of  June,  1920. 

American  Sumatra  Tobacco  Company, 

by 


Attest : 


Vice-President. 


Assistant  Secretary. 

[form  of  interest  coupon.] 

No.  $37.50 

On  the  first  day  of  ,  19  ,  unless  the  note 

hereinafter  mentioned  shall  be  called  for  previous  re¬ 
demption,  American  Sumatra  Tobacco  Company,  at  the 
office  of  The  Chase  National  Bank  of  the  City  of  New 
York  in  the  Borough  of  Manhattan,  in  the  City  of  New 
York,  will  pay  to  bearer  thirty-seven  and  50/100  dollars 
in  United  States  gold  coin,  without  deduction  for  taxes 
(other  than  inheritance  taxes  and  federal  excess  profits 
and  income  taxes  in  excess  of  2%  per  annum),  being- 
six  months'  interest  then  due  on  its  Five-Year  Seven  and 
One  Half  Per  Cent.  Sinking  Fund  Convertible  Gold  Note 
No. 


Treasurer. 


7 


[form  of  registered  note  without  coufons.] 

No.  $ 

UNITED  STATES  OF  AMERICA. 

State  of  New  York 

AMERICAN  SUMATRA  TOBACCO  COMPANY 

Registered  Five-Year  Seven  and  One-Half  Per  Cent. 

Sinking  Fund  Convertible  Gold  Note. 

American  Sumatra  Tobacco  Company,  a  Georgia 
corporation  ('hereinafter  called  the  Company),  for  value 
received,  hereby  promises  to  pay  to 

or  registered  assigns,  on  the  first  day  of  June,  1925,  at 
the  office  of  the  Trustee  hereinafter  mentioned,  in  the 
Borough  of  Manhattan,  in  the  City  and  State  of  New 
York,  the  sum  of  thousand  dollars,  in  gold  coin 

of  the  United  States  of  America,  of  or  equal  to  the  stand¬ 
ard  of  weight  and  fineness  as  it  existed  on  June  1,  1920, 
and  to  pay  interest  thereon  from  the  first  day  of  June 
or  the  first  day  of  December  as  the  case  may  be  next 
preceding  the  date  hereof  (unless  this  note  be  dated 
June  1  or  December  1  in  which  case  from  the  date  hereof), 
in  like  gold  coin,  at  the  rate  of  seven  and  one-half  per 
cent,  per  annum,  at  said  office,  semi-annually  on  the  first 
day  of  June  and  the  first  day  of  December  in  each  year. 

Both  the  principal  and  interest  of  this  note  are  pay¬ 
able  without  deduction  for  any  tax  or  taxes,  assessments 
or  other  governmental  charges  (other  than  inheritance 
taxes  and  federal  excess  profits  and  income  taxes  in 
excess  of  2%  per  annum)  which  the  Company  or  the 
Trustee  may  be  required  or  permitted  to  pay  thereon  or 
to  retain  therefrom  under  any  present  or  future  law  of 
the  United  States  of  America,  or  of  any  state,  county, 
municipality  or  other  lawful  taxing  authority  therein. 

This  note  is  one  of  a  duly  authorized  issue  of  coupon 
notes  and  registered  notes  of  the  Company,  limited  to  the 
principal  amount  of  $6,564,000  at  any  one  time  outstand¬ 
ing,  known  as  Five-Year  Seven  and  One-Half  Per  Cent. 
Sinking  Fund  Convertible  Gold  Notes,  issued  and  to  be 


8 


issued  under  an  Indenture,  dated  June  1,  1920,  executed 
by  the  Company  to  The  Chase  National  Bank  of  the  City 
of  New  York,  as  Trustee,  to  which  reference  is  hereby 
made  for  a  statement  of  the  rights  of  the  holders  or 
registered  owners  of  the  notes  issued  thereunder,  to  all 
the  provisions  whereof  the  holder  or  registered  owner 
hereof,  by  acceptance  of  this  note,  assents.  Except  as 
provided  in  said  Indenture,  all  rights  of  action  on  this 
note  are  vested  exclusively  in  the  Trustee. 

The  notes  of  said  issue  are  subject  to  redemption,  in 
whole  or  in  part,  at  the  option  of  the  Company,  at  any 
time,  on  at  least  sixty  days’  prior  notice  by  publication, 
as  provided  in  said  Indenture  at  one  hundred  and  live 
per  cent,  ( 105% )  of  the  face  value  thereof,  if  redeemed  on 
or  prior  to  June  1,  1921;  at  one  hundred  and  four  per 
cent,  (104%)  of  the  face  value  thereof,  if  redeemed  there¬ 
after  and  on  or  prior  to  June  1,  1922;  at  one  hundred 
and  three  per  cent.  (103%)  of  the  face  value  thereof, 
if  redeemed  thereafter  and  on  or  prior  to  June  1,  1923; 
at  one  hundred  and  two  per  cent.  (102%)  of  the  face 
value  thereof,  if  redeemed  thereafter  and  on  or  prior  to 
June  1,  1924;  and  at  one  hundred  and  one  per  cent, 
(101%)  of  the  face  value  thereof,  if  redeemed  thereafter 
and  prior  to  June  1,  1925,  in  each  case  together  with 
accrued  interest.  The  notes  are  subject  to  like  redemp¬ 
tion  by  operation  of  the  sinking  fund  provided  for  in 
said  Indenture. 

At  the  option  of  the  registered  owner  this  note  may  be 
converted  at  its  face  value  at  any  time  on  or  after  October 
1,  1920,  on  the  conditions  and  regulations  prescribed  in 
said  Indenture  (except  when  the  books  for  the  transfer 
of  the  common  stock  of  the  Company  are  closed  as  per¬ 
mitted  by  said  Indenture,  and  except  that  in  the  case  of 
notes  called  for  redemption  the  right  of  conversion  shall 
expire  ten  days  prior  to  the  date  fixed  for  redemption) 
into  shares  of  the  common  stock  of  the  Company,  as  its 
common  stock  shall  be  constituted  at  the  time  of  such 
conversion,  at  the  rate  of  nine  and  one-half  shares  of 
such  stock  for  a  $1,000  note  at  any  time  on  or  after 
October  1,  1920,  and  up  to  and  including  December  31, 
1921,  and  thereafter  at  the  rate  of  nine  shares  of  such 
Stock  for  a  $1,000  note,  unless  common  stock  of  the 


Company  in  addition  to  the  amount  thereof  outstanding 
on  June  1,  1920  be  issued  or  sold  (other  than  common 
stock  issued  on  conversion  and  stock  dividends  in 
amounts  permitted  by  said  Indenture)  in  which  case  the 
conversion  price  shall  be  determined  as  in  said  Indenture 
provided,  and  with  an  adjustment  of  accrued  interest  and 
dividends,  as  well  as  any  balance  of  principal  as  between 
this  note  and  the  stock  into  which  the  same  shall  be  con¬ 
verted  which  may  be  paid  to  the  registered  owner  on 
conversion,  all  in  accordance  with  the  provisions  of  said 
Indenture.  The  Company  shall  not  be  required  to  issue 
a  fraction  of  a  share  on  any  such  conversion. 

In  case  an  event  of  default  as  defined  in  said  Inden¬ 
ture  shall  happen,  the  principal  of  the  notes  may  become 
or  be  declared  due  and  payable  in  the  manner  and  with 
the  effect  provided  in  said  Indenture. 

This  note  is  transferable  by  the  registered  owner 
hereof  in  person  or  by  his  duly  authorized  attorney  upon 
the  books  of  the  Trustee  at  its  office  in  said  Borough  of 
Manhattan,  City  of  New  York,  upon  surrender  and  can¬ 
cellation  of  this  note;  and  thereupon  a  new  registered 
note  or  notes,  without  coupons,  of  an  equal  aggregate 
principal  amount,  will  be  issued  to  the  transferee,  as 
provided  in  said  Indenture.  The  registered  owner  of  this 
note  has  the  right  to  surrender  the  same  for  cancella¬ 
tion  and  to  receive  in  exchange  therefor  a  coupon  note 
or  notes  of  an  equal  aggregate  principal  amount  as  pro¬ 
vided  in  said  Indenture,  and  on  payment,  if  the  Company 
shall  require  it,  of  the  charges  therein  provided  for. 

In  like  manner  and  upon  like  terms,  any  coupon  note 
or  notes  of  the  denomination  of  $1,000,  bearing  all  mi¬ 
niatured  coupons,  may  in  turn  be  exchanged  for  a  reg¬ 
istered  note  or  registered  notes  without  coupons  of  the 
like  aggregate  principal  amount,  as  provided  in  said 
Indenture. 

A  Noteholders  Committee  is  appointed  in  and  by 
said  Indenture  with  such  rights  and  powers  to  waive  de¬ 
faults  and  covenants  of  the  Company  and  to  otherwise 
act,  as  are  therein  specified. 

No  recourse  shall  be  had  for  the  payment  of  the  prin¬ 
cipal  of  or  interest  upon  this  note  or  any  part  thereof,  or 
for  any  claim  based  hereon  or  otherwise  in  respect  hereof 


10 


or  of  the  indebtedness  represented  hereby  or  of  said  In¬ 
denture,  against  any  incorporator,  stockholder,  officer  or 
director,  as  such  or  otherwise,  past,  present  or  future,  of 
the  Company  or  of  any  successor  corporation,  either 
directly  or  through  the  Company  or  any  successor  corpor¬ 
ation,  whether  by  virtue  of  any  constitutional  provision, 
statute,  or  rule  of  law  or  by  the  enforcement  of  any 
assessment  or  otherwise,  all  such  liability  being  by  the 
acceptance  hereof  and  as  part  of  the  consideration  hereof 
expressly  released,  as  provided  in  said  Indenture. 

This  note  shall  not  be  valid  or  become  obligatory  for 
any  purpose  until  it  shall  have  been  authenticated  by  the 
Certificate  of  the  Trustee  under  said  Indenture  hereon 
endorsed. 

In  witness  whereof,  American  Sumatra  Tobacco 
Company  has  caused  this  note  to  be  signed  in  its  name 
by  its  President  or  one  of  its  Vice-Presidents  and  its 
corporate  seal  to  be  hereunto  affixed  and  to  be  attested  by 
its  Secretary  or  one  of  its  Assistant  Secretaries,  as  of  the 
day  of  ,  19 

American  Sumatra  Tobacco  Company, 
by 


Attest : 


Vice-President. 


Assistant  Secretary. 

[form  of  trustee’s  certificate.] 

This  note  is  one  of  the  notes  described  in  the  within- 
mentioned  Indenture. 


The  Chase  National  Bank  of  the  City  of  New  York, 

Trustee. 

by 


Asst.  Cashier. 


And  whereas  the  Company  has  determined  as  afore¬ 
said  to  execute  an  indenture  in  the  form  of  this  Inden¬ 
ture,  and  all  requirements  of  law  relating  to  the  autliori- 


11 


zation  of  the  issue  and  sale  of  Notes  convertible  into 
common  stock,  as  in  this  Indenture  provided,  have  been 
complied  with,  and  all  things  necessary  to  make  the 
Notes,  when  authenticated  by  the  Trustee  and  issued 
under  this  Indenture,  the  valid,  binding  and  legal  obli¬ 
gations  of  the  Company,  and  to  make  this  Indenture  a 
valid,  binding  and  legal  agreement,  have  been  done  and 
performed : 

Now,  THEREFORE,  THIS  INDENTURE  WITNESSETH, 
that,  in  order  to  secure  to  all  present  and  future 
owners  and  holders  of  the  Notes,  and  the  coupons,  is¬ 
sued  and  to  be  issued  and  outstanding  under  this  In¬ 
denture,  equal  and  proportionate  rights  and  benefits, 
and  to  secure  the  performance  of  all  the  covenants 
and  conditions  herein  contained,  for  and  in  consideration 
of  the  premises  and  of  the  acceptance  or  purchase  of  the 
Notes  by  the  holders  and  registered  owners  thereof,  and 
of  the  sum  of  one  hundred  dollars,  lawful  money  of  the 
United  States  of  America,  to  it  paid  by  the  Trustee  at 
or  before  the  ensealing  and  delivery  of  these  presents, 
the  receipt  whereof  is  hereby  acknowledged,  the  Company 
covenants  and  agrees  with  the  Trustee,  for  the  equal 
benefit  of  all  present  and  future  holders  and  registered 
owners  of  the  Notes  and  of  the  coupons  appertaining  to 
the  coupon  Notes,  without  preference,  priority  or  dis¬ 
tinction  of  any  of  the  Notes  over  any  of  the  others  by 
reason  of  priority  in  time  of  issue  or  negotiation  thereof, 
or  otherwise,  as  follows : 

ARTICLE  ONE. 

Form,  Execution,  Delivery,  Registration  and 
Exchange  of  Notes. 

Section  1.  The  Notes  and  the  interest  coupons  apper¬ 
taining  to  the  coupon  Notes  shall  be  substantially  of  the 


12 


tenor  and  purport  above  recited.  The  Notes  shall  bear 
interest  at  the  rate  of  seven  and  one-half  per  cent,  per 
annum,  and  such  interest  sliall  be  payable  semi-annually 
on  the  first  day  of  June  and  the  first  day  of  December  in 
each  year.  The  coupon  Notes  shall  be  in  the  denomina¬ 
tions  of  $1,000,  $500  and  $100  each.  The  coupon  Notes  of 
the  denomination  of  $1,000  shall  be  numbered  consecu¬ 
tively  from  M  1  upwards.  In  the  event  of  the  issue  of  any 
coupon  Notes  of  the  denomination  of  five  hundred  dollars 
($500)  each,  the  same  serial  number,  preceded  by  the 
letter  D,  shall  be  borne  by  two  of  such  coupon  Notes,  the 
serial  number  to  be  immediately  followed  in  the  case  of 
one  of  such  Notes  by  the  letter  A,  and  in  the  case  of  the 
other  of  such  Notes  by  the  letter  B.  Every  coupon  Note 
for  five  hundred  dollars  ($500)  shall  bear  thereon  an 
endorsement  substantially  to  the  following  effect: 

“For  this  Note  and  another  coupon  Note  of 
the  same  denomination  and  serial  number,  bearing 
affixed  letters  A  and  1>,  respectively,  a  coupon 
Note  for  one  thousand  dollars  ($1,000)  is  held  in 
reserve  and  is  not  contemporaneously  outstanding, 
and  on  the  surrender  and  cancellation  of  two  five 
hundred  dollar  ($500)  Notes,  a  coupon  Note  for 
one  thousand  dollars  ($1,000)  will  be  issued  in 
exchange  therefor  bearing  the  lowest  serial  num¬ 
ber  reserved  for  such  purpose.” 

In  the  event  of  the  issue  of  any  Notes  in  the  denomi¬ 
nation  of  one  hundred  dollars  ($100)  each,  the  same 
serial  number,  preceded  by  the  letter  C,  shall  be  borne 
by  ten  such  Notes  bearing  affixed  letters  A  to  J,  respect¬ 
ively.  Every  Note  for  one  hundred  dollars  ($100)  shall 
bear  thereon  an  endorsement  substantially  to  the  follow¬ 
ing  effect : 


13 


“For  this  Note  and  nine  other  coupon  Notes 
of  the  same  denomination  and  serial  number,  bear¬ 
ing  affixed  letters  A  to  J,  respectively,  a  coupon 
Note  for  one  thousand  dollars  ($1,000)  is  held  in 
reserve  and  is  not  contemporaneously  outstanding, 
and  on  the  surrender  and  cancellation  of  ten  one 
hundred  dollar  ($100)  Notes,  a  coupon  Note  for 
one  thousand  dollars  ($1,000)  will  be  issued  in  ex¬ 
change  therefor  bearing  the  lowest  serial  number 
reserved  for  such  purpose.” 

Whenever  any  Notes  shall  be  issued  originally  for 
five  hundred  dollars  ($500),  there  shall  be  reserved 
unissued,  an  aggregate  face  amount  of  coupon  Notes  of 
the  denomination  of  one  thousand  dollars  ($1,000)  equal 
to  the  aggregate  face  amount  of  the  Notes  for  five  hun¬ 
dred  dollars  ($500)  so  issued.  Whenever  any  Notes 
shall  be  issued  originally  for  one  hundred  dollars  ($100), 
there  shall  be  reserved  unissued,  an  aggregate  face 
amount  of  coupon  Notes,  of  the  denomination  of  one 
thousand  dollars  ($1,000),  equal  to  the  aggregate  face 
amount  of  the  Notes  for  one  hundred  dollars  ($100)  so 
issued.  Whenever  two  Notes  of  the  denomination  of 
five  hundred  dollars  ($500)  or  ten  Notes  of  the  denomi¬ 
nation  *of  one  hundred  dollars  ($100),  having  all  un¬ 
matured  coupons  attached  thereto,  shall  be  surrendered 
for  exchange  for  a  one  thousand  dollar  ($1,000)  coupon 
Note  at  the  office  of  the  Trustee,  in  the  City  of  New 
York,  the  Company  shall  issue,  and  the  Trustee  shall 
authenticate  and  deliver  a  coupon  Note  of  the  denomina¬ 
tion  of  one  thousand  dollars  ($1,000)  with  all  unmatured 
coupons  thereto  attached,  and  bearing  the  lowest  serial 
number  reserved  for  such  purpose. 

Whenever  any  coupon  Note  of  the  denomination  of 
one  thousand  dollars  ($1,000),  with  all  unmatured  cou- 


14 


pons  thereto  attached,  shall  be  surrendered  for  exchange 
for  Notes  of  the  denomination  of  five  hundred  dollars 
($500)  or  one  hundred  dollars  ($100),  at  said  office  of 
the  Trustee,  the  Company  shall  issue,  and  the  Trustee 
shall  authenticate  and  deliver,  in  exchange  for  such  Note 
for  one  thousand  dollars  ($1,000),  two  Notes  for  five 
hundred  dollars  ($500)  each,  or  ten  Notes  for  one  hun¬ 
dred  dollars  ($100)  each,  with  all  unmatured  coupons 
thereto  attached.  Said  Notes  for  five  hundred  dollars 
($500)  each,  or  one  hundred  dollars  ($100)  each,  issued 
upon  such  exchange,  may  bear  such  numbers  and  letters, 
and  legends,  and  the  said  exchange  may  be  effected  in 
such  manner  as  may  be  directed  by  the  Board  of  Directors 
of  the  Company  with  the  approval  of  the  Noteholders 
Committee  hereinafter  mentioned,  and  as  may  be  neces¬ 
sary  to  comply  with  the  rules  of  any  Stock  Exchange,  or 
to  conform  to  usage  with  respect  thereto. 

The  Chase  National  Bank  of  the  City  of  New  York 
is  hereby  appointed  agent  of  the  Company  for  the  pur¬ 
pose  of  effecting  all  exchanges  of  Notes  mentioned  in 
this  Indenture. 

In  every  case  of  exchange  of  Notes,  the  Trustee  shall 
forthwith  cancel  the  surrendered  Note  or  Notes  and 
coupons,  and  shall  deliver  the  same  to  the  Company  upon 
its  written  demand.  For  any  exchange  of  Notes,  the 
Company  may  make  a  charge  sufficient  to  reimburse  it 
for  any  stamp  tax  or  governmental  charge  required  to  be 
paid,  and  in  addition  may  charge  a  sum  not  exceeding 
one  dollar  ($1)  for  each  Note  issued  upon  such  exchange. 

Section  2.  The  aggregate  principal  amount  of  all  the 
Notes  which  may  be  issued  and  outstanding  under  this 
Indenture  at  any  one  time  shall  not  in  any  event  exceed 
the  sum  of  $6,564,000.  The  Notes  shall  be  executed  in  the 
name  and  on  behalf  of  the  Company  by  its  President  or 


15 


one  of  its  Vice-Presidents  and  its  corporate  seal  shall  be 
thereunto  affixed  and  shall  be  attested  by  its  Secretary 
or  one  of  its  Assistant  Secretaries.  The  Notes  shall  then 
be  delivered  to  the  Trustee  for  authentication  by  it,  and 
thereupon,  as  provided  in  Article  Two  hereof  and  not 
otherwise,  the  Trustee  shall  authenticate  and  deliver  the 
same.  At  the  option  of  the  Company  from  time  to  time, 
any  of  the  Notes  may  be  executed,  authenticated  and 
delivered  originally  either  as  coupon  Notes  or  as  regis¬ 
tered  Notes. 

In  case  the  officers  who  shall  have  signed  any  of 
the  Notes  shall  cease  to  be  such  officers  of  the  Com¬ 
pany  before  the  Notes  so  signed  shall  have  been  actually 
authenticated  and  delivered  by  the  Trustee,  such  Notes 
may,  nevertheless,  be  adopted  by  the  Company  and  be 
issued,  authenticated  and  delivered,  as  though  the  per¬ 
sons  who  signed  such  Notes  had  not  ceased  to  be  such 
officers  of  the  Company;  and  also  any  Notes  may  be 
signed  on  behalf  of  the  Company  by  such  persons  as  at 
the  actual  time  of  the  execution  of  such  Notes  shall  be 
the  proper  officers  of  the  Company,  although  at  the  date 
of  such  Notes  such  persons  may  not  have  been  such 
officers  of  the  Company.  The  coupons  to  be  attached  to 
the  coupon  Notes  shall  be  authenticated  by  the  facsimile 
signature  of  the  present  treasurer  or  of  any  future  treas¬ 
urer  of  the  Company,  and  the  Company  may  adopt  and 
use  for  that  purpose  the  facsimile  signature  of  any  person 
who  shall  have  been  such  treasurer,  notwithstanding  the 
fact  that  he  may  have  ceased  to  be  such  treasurer  at  the 
time  when  the  Notes  shall  be  actually  authenticated  and 
delivered.  Only  such  of  the  Notes  as  shall  bear  thereon 
endorsed  an  authentication  substantially  in  the  form 
hereinbefore  recited,  executed  by  the  Trustee,  shall  be 
issued  under  this  Indenture  or  entitled  to  any  right  or 
benefit  hereunder,  and  such  authentication  by  the  Trustee 


16 


on  any  such  Note  as  aforesaid  shall  be  conclusive  evidence 
that  the  Note  so  authenticated  has  been  duly  authenti¬ 
cated  and  delivered  hereunder  and  that  the  holder  is 
entitled  to  the  benefit  of  the  trusts  hereby  created.  Before 
authenticating  or  delivering  any  coupon  Note,  all  coupons 
thereto  appertaining  then  matured  shall  be  cut  off  and 
cancelled  by  the  Trustee  and  on  its  written  demand  de¬ 
livered  to>  the  Company,  and  the  Trustee  shall  not  authen¬ 
ticate  or  deliver  any  registered  Note  bearing  interest  from 
a  date  more  than  six  months  prior  to  such  authentication. 
The  Company  and  the  Trustee  may  deem  and  treat  the 
bearer  of  any  coupon  Note  which  shall  not  be  registered 
as  to  principal,  and  the  bearer  of  any  coupon  for  interest 
on  any  coupon  Note,  whether  such  Note  shall  have  been 
so  registered  or  not,  as  the  absolute  owner  of  such  Note 
or  coupon  for  the  purpose  of  receiving  payment  thereof 
and  for  all  other  purposes  whatsoever,  and  the  Company 
and  the  Trustee  shall  not  be  affected  by  any  notice  to  the 
contrary.  The  Company  and  the  Trustee  may  deem  and 
treat  the  registered  owner  of  any  coupon  Note  which 
has  been  registered  as  to  principal  as  the  absolute  owner 
of  such  Note  for  all  purposes  except  the  payment  of  cou¬ 
pons,  and  may  treat  the  person  in  whose  name  any  regis¬ 
tered  Note  without  coupons  is  registered  as  the  absolute 
owner  thereof  for  all  purposes,  and  the  Company  and  the 
Trustee  shall  not  be  affected  by  any  notice  to  the  contrary. 

Section  3.  The  registered  Notes  without  coupons  may 
be  of  the  denominations  of  $1,000  or  any  multiples 
thereof.  The  registered  Notes  shall  respectively  be 
dated  the  day  of  issue  and  shall  bear  interest  from  the 
first  day  of  June  or  the  first  day  of  December,  as  the  case 
may  be,  next  preceding  the  date  of  the  Notes,  unless 
dated  June  1st  or  December  1st,  and  in  that  event  from 
the  date  thereof.  Whenever  any  Notes  shall  be  originally 


17 


issued  as  registered  Notes  without  coupons  there  shall 
be  reserved  by  the  Company  unissued  an  aggregate  prin¬ 
cipal  amount  of  coupon  Notes  of  the  denominations  of 
$1,000  each,  equal  to  the  principal  amount  of  the  regis¬ 
tered  Notes  without  coupons  so  issued,  and  the  serial 
number  or  numbers  of  the  coupon  Note  or  coupon  Notes 
so  reserved  unissued  shall  by  the  Company  be  endorsed 
on  such  registered  Notes  issued  in  lieu  thereof.  Every 
registered  Note  without  coupons  shall  bear  thereon  an 
endorsement  in  substantially  the  following  form,  viz. : 

“The  within  Note  is  issued  in  lieu  of  or  in  ex¬ 
change  for  coupon  Note(s)  No(s)  M — for  $1,000 
each  not  contemporaneously  outstanding;  and 
coupon  Note(s)  of  said  denomination  and  bearing 
said  serial  number  (s)  will  be  issued  in  exchange 
for  this  Note  upon  its  surrender  and  cancellation.” 

Whenever  any  registered  Note  or  Notes  shall  be  sur¬ 
rendered  for  transfer,  the  Company  shall  execute  and 
the  Trustee  shall  authenticate  and  deliver  upon  surrender 
and  cancellation  of  the  Note  or  Notes  transferred,  one 
or  more  registered  Notes  without  coupons  for  a  like 
principal  amount,  bearing  interest  from  the  last  pre¬ 
ceding  interest  day,  and  which  shall  have  endorsed 
thereon  the^  same  serial  number  or  numbers  of  coupon 
Notes  which  were  endorsed  upon  the  registered  Note 
or  Notes  so  surrendered  and  cancelled.  For  any  trans¬ 
fer  of  registered  Notes,  the  Company  at  its  option  may 
require  the  payment  of  a  sum  sufficient  to  reimburse  it 
for  any  stamp  tax  or  other  governmental  charge  con¬ 
nected  therewith,  and  also  of  the  further  sum  of  not 
exceeding  one  dollar  for  each  new  Note  issued  upon  such 
transfer. 

Section  4.  Until  the  definitive  Notes  shall  be  pre¬ 
pared,  the  Company  may  execute  and,  upon  the  request 


18 


of  the  Company,  the  Trustee  shall  authenticate  and  de¬ 
liver,  in  lieu  of  definitive  Notes  and  subject  to  the  same 
provisions,  limitations  and  conditions,  one  or  more  tem¬ 
porary  printed,  lithographed  or  typewritten  Notes  of  the 
denomination  of  flOO  or  of  any  multiple  thereof,  sub¬ 
stantially  of  the  tenor  hereinbefore  recited,  but  without 
coupons,  and  with  appropriate  omissions,  insertions  and 
variations,  as  may  be  required.  Each  of  said  Temporary 
Notes  shall  bear  upon  its  face  the  words  “Temporary  Five 
Year  Seven  and  One-lialf  Per  Cent  Sinking  Fund  Con¬ 
vertible  Gold  Note,  exchangeable  for  Definitive  Note(s)”. 
The  authentication  by  the  Trustee  on  any  said  temporary 
Note  shall  be  conclusive  evidence  and  the  only  evidence 
that  the  temporary  Note  so  authenticated  has  been  duly 
issued  hereunder,  and  that  the  holder  is  entitled  to  the 
benefit  of  the  trust  hereby  created.  Upon  surrender  of 
said  temporary  Notes  for  exchange,  the  Company,  at  its 
own  expense,  shall  prepare  and  execute,  and,  upon  can¬ 
cellation  of  said  surrendered  temporary  Notes,  the 
Trustee  shall  authenticate  and  shall  deliver  in  exchange 
therefor,  definitive  Notes  for  the  same  aggregate  prin¬ 
cipal  amount  as  the  temporary  Notes  surrendered  and 
otherwise  in  accordance  with  said  temporary  Notes. 
Until  so  exchanged,  the  temporary  Notes  shall  in  all 
respects  be  entitled  to  the  same  benefits  of  this  Indenture 
as  the  definitive  Notes  to  be  issued  and  authenticated 
hereunder,  and  interest,  when  and  as  payable,  shall  be 
paid  and  notation  of  such  payment  endorsed  thereon  upon 
presentation  thereof  for  that  purpose. 

Section  5.  In  case  any  coupon  Note,  with  the  cou¬ 
pons  thereto  appertaining,  or  any  registered  Note  with¬ 
out  coupons,  or  any  temporary  Note  without  coupons, 
shall  become  mutilated  or  be  destroyed  or  lost,  the  Com¬ 
pany,  in  its  discretion,  may  execute,  and  thereupon  the 


19 


Trustee  shall  authenticate  and  deliver,  a  new  Note  of 
like  tenor,  date  and  amount  and  bearing  the  same  serial 
number,  in  exchange  and  substitution  for,  and  upon  can¬ 
cellation  of,  the  mutilated  coupon  Note  and  its  coupons, 
or  the  mutilated  registered  or  temporary  Note  without 
coupons,  or  in  lieu  of  and  substitution  for  the  coupon 
Note  and  its  coupons,  or  the  registered  or  temporary 
Note  without  coupons,  so  destroyed  or  lost.  The  appli¬ 
cant  for  such  substituted  Note  shall  furnish  to  the  Com¬ 
pany  and  to  the  Trustee  evidence  of  the  destruction  or 
loss  of  such  coupon  Note  and  its  coupons,  or  of  such 
registered  or  temporary  Note  without  coupons,  so  de¬ 
stroyed  or  lost,  which  evidence  shall  be  satisfactory  to 
the  Company  and  to  the  Trustee,  in  their  discretion. 
Said  applicant  shall  also  furnish  indemnity  satisfactory 
to  the  Company  and  to  the  Trustee,  in  their  discretion, 
and  shall  comply  with  such  other  reasonable  regulations 
as  they  or  either  of  them  may  prescribe.  The  Trustee 
shall  incur  no  liability  to  anyone  by  reason  of  anything 
done  or  omitted  by  it  in  good  faith  under  the  provisions 
of  this  section. 

Section  6.  The  Company  will  keep,  at  the  office  of 
the  Trustee  in  the  Borough  of  Manhattan,  the  City  of 
New  York,  a  sufficient  register  or  registers  for  the  regis¬ 
tration  and  transfer  of  the  Notes;  and,  upon  presentation 
for  such  purposes,  the  Company  will,  under  such  reason¬ 
able  regulations  as  it  may  prescribe,  register  therein  any 
of  the  Notes.  The  holder  of  any  coupon  Note  may  have 
the  ownership  thereof  registered  at  said  office,  and  such 
registration  noted  on  the  Note.  After  such  registration 
no  transfer  shall  be  valid  unless  made  at  said  office  by  the 
registered  holder  in  person  or  by  his  attorney  thereunto 
duly  authorized  and  similarly  noted  on  the  Note.  Upon 
presentation  to  the  Registrar,  at  said  office,  of  any  coupon 


20 


Note  registered  as  to  principal,  accompanied  by  delivery 
of  a  written  instrument  of  transfer  in  form  approved  by 
the  Company,  executed  by  the  registered  holder  in  person 
or  by  his  attorney  thereunto  duly  authorized,  such  Note 
shall  be  transferred  upon  such  register  and  such  transfer 
shall  be  noted  by  the  Registrar  upon  the  Note.  The  regis¬ 
tered  bolder  of  any  coupon  Note  registered  as  to  principal 
shall  also  have  the  right  to'  cause  the  same  to  be  registered 
as  payable  to  bearer,  in  which  case  transferability  by 
delivery  shall  be  restored,  and  thereafter  the  principal 
of  such  Note,  when  due,  shall  be  payable  to  the  person 
presenting  the  same.  Any  coupon  Note  registered  as 
payable  to  bearer  may  be  registered  again  in  the  name 
of  the  holder  with  the  same  effect  as  a  first  registration 
thereof.  Successive  registrations  and  transfers,  as  afore¬ 
said,  may  be  made  from  time  to  time  as  desired,  and  each 
registration  of  a  Note  shall  be  noted  by  the  Registrar 
thereon.  The  registration  of  any  coupon  Note,  however, 
shall  not  affect  the  negotiability  by  delivery  merely  of 
coupons  appertaining  to  such  Note,  but  every  such  coupon 
shall  continue  to  pass  by  delivery  and  shall  remain  pay¬ 
able  to  bearer,  and  payment  thereof  to  bearer  shall  fully 
discharge  the  Company  in  respect  of  the  interest  therein 
mentioned  whether  or  not  such  Note  be  registered.  For 
any  such  transfer  or  registration  of  a  coupon  Note,  the 
Company  may  require  the  payment  of  a  sum  sufficient  to 
reimburse  it  for  any  stam})  tax  or  other  governmental 
charge.  The  Trustee  is  hereby  appointed  the  Note  Regis¬ 
trar  of  the  Company  for  the  purposes  in  this  Indenture 
set  forth. 

Section  7.  The  holder  of  any  coupon  Note  or  Notes 
of  the  denomination  of  f 1,000  may  at  his  option  surrender 
the  same  with  all  unmatured  coupons  thereunto  apper¬ 
taining  for  cancellation  and  receive  in  exchange  therefor 


21 


as  hereinafter  provided  an  equal  principal  amount  of 
registered  Notes  without  coupons.  The  registered  holder 
of  any  registered  Note  without  coupons  may  at  his  option 
surrender  the  same  for  cancellation  and  receive  in  ex¬ 
change  therefor  as  hereinafter  provided  an  equal  prin¬ 
cipal  amount  of  coupon  Notes.  Every  registered  Note 
without  coupons  shall  as  hereinbefore  provided  be  trans¬ 
ferable  by  the  registered  holder  thereof  in  person  or  by 
his  duly  authorized  attorney  on  the  books  of  the  Registrar 
kept  at  its  said  office  and  upon  the  surrender  and  cancella¬ 
tion  thereof  one  or  more  new  registered  Notes  without 
coupons  shall  be  issued  to  the  transferee  in  exchange 
therefor. 

Section  8.  Whenever  any  coupon  Note  or  coupon 
Notes  of  the  denomination  of  $1,000,  together  with  all 
unmatured  coupons  thereunto  appertaining  shall  be  sur¬ 
rendered  for  exchange  for  a  registered  Note  or  Notes 
without  coupons,  accompanied,  if  registered,  by  an  instru¬ 
ment  of  assignment  in  blank  in  form  satisfactory  to  the 
Trustee,  the  Company  shall  execute  and  thereupon  the 
Trustee  shall  authenticate  and  deliver  in  exchange  for 
such  coupon  Note  or  coupon  Notes  a  registered  Note 
or  Notes  of  an  equal  principal  amount  bearing  interest 
from  the  due  date  of  the  last  matured  coupon  of  such 
coupon  Note  or  coupon  Notes,  which  registered  Note 
or  registered  Notes  without  coupons  shall  have  endorsed 
thereon  the  serial  number  or  numbers  borne  by  the 
coupon  Note  or  coupon  Notes  so  surrendered  for  ex¬ 
change.  Whenever  any  registered  Note  without  coupons 
shall  be  surrendered  for  exchange  for  one  or  more  coupon 
Notes  of  the  denomination  of  $1,000,  accompanied  by 
an  instrument  of  assignment  in  blank  in  form  satisfactory 
to  the  Trustee,  the  Company  shall  execute  and  the 
Trustee  shall  certify  and  deliver  in  exchange  for  such 


22 


registered  Note  without  coupons  an  equal  principal 
amount  of  coupon  Note  or  Notes  bearing  the  serial  num¬ 
ber  or  numbers  endorsed  upon  the  registered  Note  with¬ 
out  coupons  so  surrendered  and  with  coupons  for  interest 
thereto  attached,  maturing  on  and  after  the  next  ensuing 
interest  payment  date. 

For  any  exchange  of  coupon  Notes  for  registered 
Notes  without  coupons  or  of  registered  Notes  without 
coupons  for  coupon  Notes,  the  Company  at  its  option 
may  require  the  payment  of  a  sum  sufficient  to  reimburse 
it  for  any  stamp  tax  or  other  governmental  charge  con¬ 
nected  therewith  or  resulting  therefrom,  and  also  of  a 
further  sum  of  not  exceeding  One  dollar  ($1)  for  each 
new  Note  issued  upon  such  transfer  or  exchange. 

Section  9.  The  Company,  with  the  consent  of  the 
Noteholders  Committee  hereinafter  mentioned,  may 
modify  any  of  the  provisions  contained  in  this  Article 
with  respect  to  the  registration  and  exchange  of  Notes, 
the  numbering,  notations,  legends  or  endorsements 
thereon  and  the  details  with  respect  thereto  in  order  to 
comply  with  any  rules  and  regulations  of  any  Stock  Ex¬ 
change  on  which  the  Notes  are  to  be  or  have  been  listed 
or  for  any  other  reason  deemed  suitable  by  the  Com¬ 
mittee. 


ARTICLE  TWO. 

Issue  op  Notes. 

Section  1.  The  Trustee,  upon  the  execution  and 
delivery  of  this  Indenture  and  without  any  further  action 
on  the  part  of  the  Company,  shall  at  any  time  or  from 
time  to  time  authenticate  .$6,564,000  aggregate  principal 
amount  of  Notes  and  deliver  them  at  any  time  or  from 
time  to  time  on  the  written  order  of  the  Company,  signed 


23 


by  its  President  or  one  of  its  Vice-Presidents,  or  its 
Treasurer  or  one  of  its  Assistant  Treasurers,  and  by  its 
Secretary  or  one  of  its  Assistant  Secretaries.  Such 
order  or  orders  shall  be  full  authority  and  protection  to 
the  Trustee  for  its  authentication  or  delivery  of  such 
Notes  under  the  foregoing  provisions  of  this  Article. 

ARTICLE  THREE. 

Particular  Covenants  of  the  Company. 

The  Company  covenants  with  the  Trustee  as  herein¬ 
after  in  this  Article  set  forth : 

Section  1.  The  Company  will  duly  and  punctually  pay 
the  principal  of  each  and  every  of  the  Notes,  and  the 
interest  accruing  thereon,  at  the  times  and  place  and  in 
the  manner  mentioned  in  the  Notes  and  in  the  coupons 
appertaining  to  the  coupon  Notes,  according  to  the  true 
intent  and  meaning  thereof,  without  deduction  from  either 
principal  or  interest  for  any  tax  or  taxes,  assessments  or 
other  governmental  charges  (other  than  inheritance 
taxes  and  federal  excess  profits  and  income  taxes  in 
excess  of  2%  per  annum)  which  the  Company  or  the 
Trustee  may  be  required  or  permitted  to  pay  thereon  or 
to  retain  therefrom  under  any  present  or  future  law  of 
the  United  States  of  America,  or  of  any  state,  county, 
municipality  or  other  lawful  taxing  authority  therein,, 
and  the  payment  of  any  such  tax  or  taxes,  assessments 
and  other  governmental  charges  the  Company  hereby  as¬ 
sumes.  The  interest  shall  be  payable  on  the  coupon  Notes 
only  upon  presentation  and  surrender  of  the  respective 
coupons  annexed  to  the  Notes  as  such  coupons  respect¬ 
ively  shall  mature.  When  and  as  paid,  all  coupons  shall  • 
forthwith  be  cancelled.  The  interest  on  the  registered 
Notes  without  coupons  shall  be  payable  only  to  or  upon 
the  order  of  the  registered  holders  thereof. 


24 


Section  2.  At  all  times,  until  all  of  the  Notes 
shall  have  been  paid,  provided  for  or  converted  into 
common  stock  of  the  Company  pursuant  to  the  pro¬ 
visions  of  Article  Six  hereof,  the  Company  either  xvill 
keep  an  office  or  an  agency  in  the  Borough  of  Manhattan, 
in  the  City  of  New  York,  where  notices  and  demands  in 
respect  to  the  Notes  and  coupons  may  be  served,  and  by 
written  notice  will  designate  such  office  or  agency  to  the 
Trustee,  or  will  designate  by  written  notice  to  the  Trustee 
a  bank  or  trust  company  in  said  Borough  for  such  purpose. 
In  default  of  any  such  office  or  agency,  or  of  such  designa¬ 
tion,  demands  may  be  made  and  notices  may  be  served  in 
said  Borough  at  the  office  of  the  Trustee. 

Section  3.  The  Company  shall  and  will  (except  as 
otherwise  permitted  by  this  Indenture)  diligently  preserve 
all  the  rights  and  franchises  to  it  granted  and  upon  it 
conferred,  in  so  far  as  they  shall  continue  to  be  advan¬ 
tageous  to  the  Company,  and  shall  and  will  at  all  times 
maintain,  preserve  and  keep  its  plants,  including  fixtures 
and  appurtenances,  and  every  part  thereof,  in  good  repair, 
working  order  and  condition,  and  will  from  time  to  time 
make  all  needful  and.  proper  repairs,  renewals  and 
replacements.  The  Company  will  promptly  pay  and 
discharge  all  taxes,  assessments  and  governmental  charges 
lawfully  levied  or  imposed  upon  it,  as  Avell  as  all  lawful 
claims  for  labor,  materials  and  supplies,  which,  if  unpaid, 
might  by  law  become  a  lien  or  charge  upon  its  property. 
Provided,  however,  that  the  Company  shall  have  the 
right  in  good  faith  to  contest  any  such  tax,  assessment, 
charge  or  claim,  and  .pending  such  contest,  to  delay  or 
refuse  payment  thereof. 

Section  4.  The  Company  will  exercise  all  lawful 
powers  which  as  stockholder  or  otherwise  it  may  possess, 


25 


to  the  end  that  each  subsidiary  and  controlled  company  of 
the  Company,  as  the  terms  are  hereinafter  defined,  shall 
(a)  preserve  its  corporate  organization  (except  as  other¬ 
wise  permitted  by  this  Indenture)  and  do  no  act  by  which 
it  might  incur  a  forfeiture  of  its  corporate  existence;  (b) 
promptly  pay  and  discharge  all  taxes,  assessments  and 
governmental  charges  lawfully  levied  or  imposed  upon  it, 
as  well  as  all  lawful  claims  for  labor,  materials  and  sup¬ 
plies,  which,  if  unpaid,  might  by  law  become  a  lien  or 
charge  upon  its  property;  provided,  however,  that  it  shall 
have  the  right,  in  good  faith  to  contest  any  such  tax, 
assessment,  charge  or  claim  and,  pending  such  contest,  to 
delay  or  refuse  payment  thereof;  (c)  keep  its  property 
and  plants,  if  any,  in  good  repair,  working  order  and 
condition  and  properly  insured;  and  (d)  not  increase  the 
amount  of  its  capital  stock  issued  and  outstanding, 
unless  forthwith  upon  the  issue  thereof  there  shall  be 
made  effective  provision  that  such  additional  stock  so 
issued  (or  such  part  of  such  additional  stock  as  shall 
equal  the  ratio  of  the  amount  of  the  capital  stock  of  said 
subsidiary  or  controlled  company  owned  by  the  Company 
immediately  preceding  the  issue  of  such  additional  stock 
to  all  of  the  capital  stock  of  said  subsidiary  or  controlled 
company  outstanding  at  that  time)  shall  forthwith  upon 
the  issue  thereof  be  acquired  by  the  Company. 

Section  5.  The  Company  agrees  that  no  mortgage,  lien 
or  encumbrance  exists  on  or  against  its  properties  or  any 
part  thereof  or  the  income  therefrom  except  mortgages 
aggregating  in  principal  amount  not  in  excess  of  $50,000. 
The  Company  will  riot  create  or  permit  to  be  created  any 
mortgage,  pledge,  lien  or  other  encumbrance  upon  any 
of  its  properties  or  upon  the  income  thereof,  and  will  not 
issue  any  debentures  or  notes  or  obligations  maturing 
later  than  one  year  from  their  respective  dates  in  addi- 


26 


tion  to  the  Notes  to  be  issued  under  this  Indenture.  The 
Company  will  not  permit  any  subsidiary  or  controlled 
company  to  create  any  mortgage,  pledge,  lien  or  other 
encumbrance  upon  any  of  the  properties  or  upon  the  in¬ 
come  thereof  of  any  such  subsidiary  or  controlled  com¬ 
pany  nor  to  issue  any  preferred  stock,  debentures,  notes 
or  obligations  maturing  more  than  one  year  from  their 
respective  dates.  The  Company  may,  however,  with  the 
approval  of  the  Noteholders  Committee  create  purchase 
money  mortgages  or  other  purchase  money  liens  and 
permit  any  subsidiary  or  controlled  company  so  to  do, 
but  the  Company  agrees  that  the  principal  thereof  and 
interest  thereon  shall  be  duly  paid  when  due  and  all  the 
terms  and  provisions  thereof  duly  observed. 


Section  6.  The  term  “subsidiary”  or  “subsidiary  com¬ 
pany”,  as  used  in  this  Indenture,  shall  mean  any  company 
all  or  substantially  all  of  the  outstanding  capital  stock 
of  which  having  voting  power  is  at  the  time  owned  by  the 
Company,  either  directly  or  through  one  or  more  sub¬ 
sidiary  companies.  “Substantially  all”  of  the  outstanding 
voting  capital  stock  shall  mean  at  least  ninety-eight  per 
cent,  of  such  outstanding  voting  capital  stock.  It  shall 
not,  however,  be  deemed,  to  include  a  corporation  all  of 
the  capital  stock  of  which,  or  all  of  the  capital  stock  of 
which  except  directors’  shares,  shall  be  owned  by  a  con¬ 
trolled  company. 

The  term  “controlled  company”,  as  used  in  this  In¬ 
denture  shall  mean  any  company,  other  than  a  subsidiary 
company,  51%  or  more  of  the  outstanding  capital  stock 
of  which,  having  voting  power,  is  at  the  time  owned  by  the 
Company,  either  directly  or  through  one  or  more  sub¬ 
sidiary  companies. 

“Quick  assets”,  as  the  term  is  used  in  this  Indenture, 
shall  mean  (a)  cash  and  cash  items,  (b)  merchandise 


27 


manufactured,  produced,  prepared,  or  in  process  of  manu¬ 
facture,  production  or  preparation,  and  raw  materials, 
by-products  and  supplies  of  all  kinds,  including  operating 
but  not  equipment  expenses  for  current  crops  not  other¬ 
wise  included,  (c)  hogs  and  other  live  stock  readily  mar¬ 
ketable  and  ( d )  good  and  valid  and  collectible  accounts 
receivable  which  shall  not  have  been  created  more  than 
one  year  prior  thereto-,  and  good  and  valid  and  collect¬ 
ible  bills  receivable  which  shall  not  mature  more  than 
one  year  subsequent  to  their  date  (all  material  and  pro¬ 
duct  in  current  process  of  manufacture  shall  be  taken  at 
cost,  exclusive  of  interest,  and  all  stocks  of  merchandise, 
supplies  and  all  other  material  and  product,  including 
raw  material  and  finished  product  and  live  stock,  shall  be 
taken  at  cost,  exclusive  of  interest,  if  such  cost  be  below 
market  value,  but  at  market  value  if  that  be  below  cost)  ; 
and  (c)  bonds  and  obligations  of  the  United  States 
Government  and  other  securities  readily  marketable 
taken  at  their  fair  market  value,  except  stock  of  sub¬ 
sidiary  or  controlled  companies.  Receivables  or  other 
obligations  owing  to  the  Company  from  any  subsidiary  or 
controlled  company  shall  not,  without  the  consent  of  the 
Noteholders  Committee,  be  included  as  quick  assets  un¬ 
less  the  quick  assets  of  such  subsidiary  or  controlled 
company,  as  herein  defined,  shall  be  equal  to  one  and 
three-quarter  times  its  liabilities,  as  herein  defined,  and 
provided  that  such  receivables  or  obligations  are  not 
created  to  provide  funds  for  capital  expenditures  of  the 
subsidiary  or  controlled  company.  In  the  case  of  a 
subsidiary  company  its  quick  assets  and  liabilities  as 
herein  defined  shall  either  be  included  in  the  quick  assets 
and  liabilities  of  the  Company  upon  the  basis  of  a  con¬ 
solidated  balance  sheet,  or,  at  the  option  of  the  Company, 
it  may  determine  its  quick  assets  and  liabilities  on  the 
basis  of  its  own  balance  sheet,  treating  its  stock  interest 


28 


in  its  subsidiary  companies  as  investments.  If,  however, 
its  interest  in  the  quick  assets  of  any  subsidiary  is  to  be 
determined,  all  stock  of  such  subsidiary  held  by  others 
shall  be  deducted  from  the  quick  assets  in  arriving  at  the 
proportion  of  quick  assets  to  which  the  Company  is  en¬ 
titled.  There  shall  not  be  included  as  quick  assets  any 
receivables  or  obligations  to  the  Company  or  any  subsid¬ 
iary  from  corporations  in  which  the  Company  or  any  sub¬ 
sidiary  company  shall  have  a  substantial  holding  of  stock 
which  were  issued  or  created  to  provide  funds  for  capital 
expenditures.  All  United  States  Government  obligations 
may  be  excluded  from  quick  assets,  in  which  event  any 
amounts  borrowed  to  purchase  them  and  then  owing  by 
the  Company  shall  be  excluded  from  the  liabilities.  The 
term  “liabilities”  as  used  in  this  Indenture  shall  mean 
liabilities  due  or  not  due,  contingent  or  direct,  including 
all  Notes  which  shall  then  be  outstanding  under  such 
Indenture  (not  including  Notes  in  the  sinking  fund),  and 
including  all  taxes  accrued  and  unpaid  at  the  end  of 
any  fiscal  year,  and  that  part  of  the  instalment  to  the 
sinking  fund  that  shall  next  be  payable  which  the 
time  that  shall  have  elapsed  since  the  last  preceding 
payment  date  bears  to  one  year  upon  the  basis  of  the 
greatest  amount  of  Notes  at  any  time  outstanding.  Con¬ 
tingent  obligations  of  the  Company,-  however,  need  not  be 
included  among  the  liabilities  if  they  are  secured  to  the 
satisfaction  of  the  Noteholders  Committee  hereinafter 
provided  for.  Net  quick  assets  shall  mean  “quick  assets” 
as  herein  defined  less  “liabilities”  as  herein  defined. 

Section  7.  The  Company  will  not  after  September  30, 
1920,  declare  or  pay  any  dividends  on  its  preferred  or 
common  stock  at  any  time  when  its  net  quick  assets  as 
hereinbefore  defined  are  not  at  least  equal  to  one  and 
three-fourths  times  the  face  amount  of  the  Notes  at  the 


29 


time  outstanding,  or  when  by  the  payment  of  any  such 
dividend  the  net  quick  assets  would  be  reduced  below 
such  ratio. 

Section  8.  The  Company  will  at  all  times  have  and 
maintain  quick  assets  as  hereinbefore  defined  double  its 
liabilities  as  hereinbefore  defined,  excluding  from  such 
liabilities,  however,  (but  for  the  purpose  of  this  Sentence 
only)  the  amount  of  Notes  then  outstanding  hereunder. 
The  Company  will  at  all  times  have  quick  assets  as  herein¬ 
before  defined  equal  to  125%  of  the  amount  of  its  liabili¬ 
ties  as  hereinbefore  defined  including  the  amount  of  Notes 
at  the  time  outstanding  hereunder. 

Section  9.  Except  as  permitted  by  Article  Eleven  of 
this  Indenture  the  Company  will  not  merge  or  consoli¬ 
date  with  any  company  or  companies  or  concerns,  nor 
sell  or  lease  its  properties  as  an  entirety,  nor  permit  any 
subsidiary  so  to  do  except  with  or  to  itself  or  any  other 
subsidiary  nor  (unless  the  proceeds  are  applied  towards 
the  redemption  of  said  Notes,  or  permanent  assets  of 
equal  value  are  substituted  therefor)  sell  or  otherwise 
dispose  of  any  important  portion  of  its  permanent  assets 
or  permit  any  subsidiary  so  to  do,  except  as  aforesaid. 

Section  10.  The  Company  will  furnish  the  Note¬ 
holders  Committee,  hereinafter  mentioned,  semi-annually 
and  at  such  other  times  as  the  Committee  may  request  a 
balance  sheet  and  income  account  and  other  financial 
statements  of  the  Company  and  its  subsidiaries,  setting 
forth  in  reasonable  detail  the  financial  condition  of  the 
Company  and  subsidiaries  at  the  time  and  a  statement 
showing  the  aggregate  value  of  the  quick  assets  and  the 
aggregate  amount  of  the  liabilities  as  hereinbefore  de¬ 
fined,  and  also  in  the  case  of  controlled  companies  to  the 
extent  that  the  Company  is  able  so  to  do. 


30 


Section  11.  The  Company  agrees  to  promptly  pay  or 
discharge,  extend  or  renew,  or  cause  to  be  paid  or  dis¬ 
charged,  extended  or  renewed,  any  and  all  of  its  debts, 
expenses  and  obligations  as  the  same  shall  mature  and 
become  payable,  and  any  and  all  other  legal  claims  and 
demands  which  may  at  any  time  lie  made  against  it,  pro¬ 
vided,  however,  that  nothing  in  this  Section  contained 
shall  require  the  Company  to  pay  or  discharge,  or  cause 
to  be  paid  or  discharged,  the  same  so  long  as  in  good  faith 
the  validity  thereof  shall  be  contested. 

Section  12.  The  Company  will  at  all  times  either 
insure  and  keep  insured  at  a  fair  value  its  properties  and 
assets  or  so  much  thereof  as  is  customarily  insured  by 
corporations  of  like  character  against  loss  or  damage  by 
fire,  or  in  lieu  thereof,  in  respect  of  all  or  any  part  of 
such  properties  or  assets  will  maintain  a  system  of  self- 
insurance  which  will  accord  with  the  most  approved  prac¬ 
tice  of  corporations  maintaining  such  systems,  and  in  such 
case  will  maintain  an  adequate  insurance  reserve. 

Section  13.  The  Company  will  do,  execute,  acknowl¬ 
edge  and  deliver,  or  cause  to  be  done,  executed,  acknowl¬ 
edged  and  delivered,  all  and  every  such  further  agree¬ 
ments,  acts  and  assurances  in  the  law  to  carry  out  and 
effectuate  the  purposes  and  intents  hereof  as  the  Note¬ 
holders  Committee  hereinafter  mentioned  or  the  Trustee 
shall  reasonably  require. 

Section  14.  The  Company  covenants  and  agrees  to 
observe  and  perform  any  and  all  terms,  conditions,  pro¬ 
visions  and  agreements  at  any  time  prescribed  by  the 
Noteholders  Committee  in  connection  with  any  consent, 
waiver  or  concession  given  by  the  Committee  hereunder 
in  any  case,  and  which  the  Company  has  accepted  by 
acting  under  the  same  or  otherwise. 


31 


Section  15.  The  Company  will  not,  directly  or  in¬ 
directly,  extend  or  assent  to  the  extension  of  the  time  of 
payment  of  any  Note  or  coupon  or  any  interest  due  on 
any  registered  Note  without  coupons,  and  will  not, 
directly  or  indirectly,  be  a  party  to  or  approve  any 
arrangement  thereof  by  the  purchase  or  funding  of  any 
of  said  Notes  or  coupons  or  interest  charges. 

Neither  any  coupon  belonging  to  any  coupon  Note, 
nor  any  claim  for  interest  on  any  registered  Note  with¬ 
out  coupons,  which  shall  have  been  extended  in  contra¬ 
vention  of  the  provisions  of  this  Section,  nor  any  such 
coupon  or  claim  for  interest  which  in  any  way  at  or  after 
maturity  shall  have  been  transferred  or  pledged  separate 
or  apart  from  the  Note  to  which  it  relates,  unless  ac¬ 
companied  by  such  Note,  shall  be  entitled  in  case  of  a 
default  hereunder  to  any  benefit  of  or  from  this  In¬ 
denture,  except  after  the  prior  payment  in  full  of  all  of 
the  Notes  and  of  all  coupons  and  interest  obligations  not 
so  extended,  transferred  or  pledged. 

Section  1G.  The  Company  will  reimburse  to  any  holder 
or  registered  owner  of  any  Note  issued  hereunder,  when 
paid  by  any  such  holder  or  registered  owner  thereof,  all 
taxes  (other  than  succession  or  inheritance  taxes)  as¬ 
sessed  by  the  Commonwealth  of  Pennsylvania  under  any 
statute  of  said  Commonwealth  upon  any  Notes,  or  upon 
any  holder  or  registered  owner  thereof  as  a  resident  of 
said  Commonwealth  by  reason  of  his  ownership  thereof, 
whether  for  State,  County  or  Municipal  purposes,  but  not 
taxes  imposed  by  any  County  or  other  political  subdivi¬ 
sion  of  said  Commonwealth  upon  any  such  Note  or  upon 
the  holder  or  registered  owner  thereof,  but  not  in  excess  of 
four  (4)  mills  per  annum  for  each  dollar  of  the  value 
of  such  Notes,  provided  that  such  holder  or  registered 
owner  is  legally  liable  for  the  payment  of  such  tax  or 


32 


taxes,  upon  written  demand  for  such  reimbursements, 
setting  forth  the  fact  of  ownership  of  any  such  Notes  and 
the  place  of  residence  of  such  holder  or  registered  owner 
at  the  time  such  tax  or  taxes  were  assessed,  together  with 
the  serial  number  or  numbers  of  said  Notes,  and  that  such 
tax  or  taxes  were  assessed  upon  and  paid  by  such  holder 
or  registered  owner  because  of  the  ownership  by  him  of 
any  said  Notes,  and  provided  further  that  the  Company 
shall  not  have  theretofore  paid  to  the  Commonwealth  of 
Pennsylvania  the  amount  of  such  tax  applicable  to  the 
Note  or  Notes  held  or  owned  by  the  Noteholder  making 
such  application.  Such  demand  shall  be  made  upon  the 
Company  in  writing  at  its  office  in  the  City  of  New  York 
within  sixty  days  after  the  respective  dates  of  each  and 
every  payment  of  such  tax  or  taxes  by  any  such  holder 
or  registered  owner,  and  the  Company  shall  not  be  liable 
to  reimburse  any  holder  or  registered  owner  of  Notes  for 
any  such  tax  or  taxes  unless  such  demand  be  made  within 
said  period  of  sixty  days,  nor  to  reimburse  any  holder 
or  registered  owner  of  Notes  for  any  interest  or  penalty 
assessed  upon  or  paid  in  addition  to  the  amount  of  such 
tax  as  originally  assessed. 

ARTICLE  FOUR. 

Redemption  of  Notes. 

Section  1.  The  Company  may,  at  its  election,  at  any 
time,  pay  off  and  redeem  any  or  all  of  the  Notes  at  one 
hundred  and  five  per  cent.  (105%)  of  the  face  value 
thereof  and  accrued  interest,  if  redeemed  on  or  prior  to 
June  1,  1921;  at  one  hundred  and  four  per  cent.  (104%) 
of  the  face  value  thereof  and  accrued  interest,  if  redeemed 
thereafter  and  on  or  prior  to  June  1,  1922;  at  one  hun¬ 
dred  and  three  per  cent.  (103%)  of  the  face  value 
thereof  and  accrued  interest,  if  redeemed  thereafter  and 


33 


on  or  prior  to  June  1,  1923;  at  one  hundred  and  two  per 
cent.  (102%)  of  the  face  value  thereof  and  accrued  inter¬ 
est,  if  redeemed  thereafter  and  on  or  prior  to  June  1, 
1921;  and  at  one  hundred  and  one  per  cent.  (101%)  of 
the  face  value  thereof  and  accrued  interest,  if  redeemed 
thereafter  and  prior  to  June  1,  1925.  In  case  the  Com¬ 
pany  shall  elect  to  exercise  such  right  of  redemption,  it 
shall  give  notice  thereof  by  publication  at  least  once 
a  week  for  eight  successive  weeks  prior  to  the  date  on 
which  such  payment  and  redemption  is  to  be  made,  the 
first  publication  to  be  made  not  less  than  sixty  (60)  days 
nor  more  than  ninety  (90)  days  prior  to  such  redemption 
date,  in  two  daily  newspapers  of  general  circulation  pub¬ 
lished  in  the  Borough  of  Manhattan,  in  the  City  of  New 
York,  stating  such  election  on  the  part  of  the  Company 
and  specifying,  in  case  less  than  all  of  the  Notes  are  to 
be  redeemed,  the  numbers  of  the  Notes  to  be  redeemed 
(and  which,  previously  to  the  publication  of  such  notice, 
shall  have  been  designated  by  lot  under  the  direction  of 
the  Trustee  in  such  way  or  ways  as  the  Trustee  in  its 
unrestricted  discretion  may  determine),  and  stating  that 
the  interest  on  the  Notes  in  such  notice  designated  for 
redemption  shall  cease  on  such  redemption  date,  and  re¬ 
quiring  that  said  Notes  be  presented  on  said  date  for 
payment  and  redemption.  A  similar  notice  shall  be 
mailed  by  the  Company,  postage  prepaid,  at  least  eight 
weeks  prior  to  said  date  fixed  for  redemption,  to  all  reg¬ 
istered  holders  of  coupon  Notes  and  to  the  holders  of 
registered  Notes  to  be  redeemed  whose  addresses  shall 
appear  upon  the  register  or  registers  of  the  Company. 
Notice  having  been  so  published  and  mailed  the  Notes 
so  designated  for  redemption  shall  on  the  date  designated 
in  such  notice  become  due  and  payable  at  the  office  of  the 
Trustee  in  the  Borough  of  Manhattan  in  the  City  of  New 
York  at  the  redemption  price  aforesaid,  and  prior  to  the 


34 


redemption  date  the  Company  will  deposit  with  the  Trus¬ 
tee  an  amount  sufficient  to  redeem  the  Notes  then  called 
for  redemption  on  such  date;  and  from  and  after  the  date 
of  redemption  so  designated  funless  the  Company  shall 
make  default  in  payment  of  the  Notes)  interest  on  the 
Notes  so  designated  for  redemption  shall  cease  to  accrue, 
and  upon  surrender  at  the  office  of  the  Trustee  of  the 
Notes  specified  in  said  notice  in  accordance  with  said 
notice,  together  with  all  coupons  thereto  appertaining,  if 
coupon  Notes,  maturing  on  and  after  said  date  of  redemp¬ 
tion,  if  an  interest  date  or  after  said  date  of  redemption  if 
not  an  interest  date,  the  Notes  shall  be  paid  by  the  Com¬ 
pany  at  the  redemption  price  aforesaid.  If  not  so  paid 
upon  surrender  thereof,  said  Notes  shall  continue  to  bear 
interest  at  the  rate  therein  expressed  until  payment. 

Section  2.  On  deposit  with  the  Trustee  of  the  amount 
necessary  so  to  redeem  all  of  the  Notes  outstanding,  and 
on  delivery  to  the  Trustee  of  ( 1 )  proof  satisfactory  to  the 
Trustee  that  notice  of  redemption  thereof  on  a  specified 
redemption  date  has  been  published  and  mailed,  as  afore¬ 
said,  or  (2)  proof  satisfactory  to  the  Trustee  that  arrange¬ 
ments  have  been  made  insuring  to  the  satisfaction  of  the 
Trustee  that  such  notice  will  be  so  published  and  mailed, 
or  (3)  a  written  instrument  executed  by  the  Company, 
under  its  corporate  seal,  and  expressed  to  be  irrevocable, 
authorizing  the  Trustee  to  give  such  notice  for  and  on 
behalf  of  the  Company  and  on  payment  to  the  Trustee 
of  all  costs,  charges  and  expenses  in  relation  thereto,  then 
the  Trustee  shall  cancel  and  satisfy  this  Indenture.  The 
Trustee  shall  apply  the  moneys  so  deposited  with  it  to 
the  payment  at  the  redemption  price  aforesaid  of  the 
Notes  so  called  for  redemption,  but  shall  in  no  event 
be  liable  beyond  the  amount  so  deposited  with  it.  Any 
moneys  so  deposited  which  shall  not  be  required  for  the 


35 


purpose  for  which  such  deposit  was  made  shall  he  repaid 
to  the  Company  upon  its  written  request;  and  any  such 
moneys  remaining  unclaimed  by  the  holders  of  Notes 
and  coupons  for  six  years  after  the  specified  redemption 
date  shall  be  paid  by  the  Trustee  to  the  Company;  pro¬ 
vided,  however,  that  the  Trustee,  before  being  required 
to  make  any  such  payments,  may,  at  the  expense  of  the 
Company,  cause  notice  that  said  moneys  have  not  been 
so  called  for  and  that  after  a  date  named  therein  they 
will  be  returned  to  the  Company  to  be  published  once 
a  week  in  each  of  four  successive  weeks  in  a  daily  news¬ 
paper  of  general  circulation  published  in  said  Borough 
of  Manhattan. 

Section  3.  All  Notes  redeemed  or  paid  pursuant  to 
the  provisions  of  this  Article  Four  and  the  appurtenant 
coupons  shall  be  canceled  and  shall  not  be  subject  to 
reissuance  except  that  Notes  redeemed  through  the  Sink¬ 
ing  Fund  shall  be  kept  alive  therein  as  hereinafter  pro¬ 
vided. 


ARTICLE  FIVE. 

Sinking  Fund. 

Section  1.  The  Company  covenants  and  agrees  that 
it  will  pay  to  the  Trustee,  as  and  for  a  sinking  fund 
to  be  applied  as  hereinafter  in  this  Article  Five  pro¬ 
vided,  on  the  first  day  of  June  in  each  year  beginning 
with  the  year  1921,  a  sum  equal  to  five  per  cent,  of  the 
greatest  aggregate  face  amount  of  the  Notes  at  any  time 
outstanding  hereunder.  The  Company  shall  have  the 
right  to  exceed  said  sinking  fund  requirements  in  any 
year  and  to  have  any  excess  payment  or  payments 
credited  against  its  said  sinking  fund  obligation  in  sub¬ 
sequent  years  as  the  Company  shall  designate.  In  case 


36 


any  of  the  Notes  shall  be  converted  into  common  stock 
of  the  Company  pursuant  to  the  provisions  of  Article  Six 
hereof,  the  Company  shall  be  credited  with  an  amount 
equal  to  the  principal  amount  of  the  Notes  so  converted 
on  its  obligation  to  make  payments  to  the  sinking  fund, 
and  accordingly  shall  not  be  obligated  to  make  any  pay¬ 
ments  to  the  sinking  fund  at  any  time  when  the  aggre¬ 
gate  principal  amount  of  the  Notes  converted  is  in  excess 
of  the  aggregate  of  the  payments  to  the  sinking  fund 
required  to  be  made  by  it  up  to  that  time  and  not  then 
made,  or  if  such  aggregate  of  payments  required  to  be 
made  to  the  sinking  fund  and  not  then  made  is  in  excess 
of  the  principal  amount  of  Noles  converted  the  Company 
shall  only  be  obligated  to  pay  to  the  sinking  fund  such 
excess  and  so  on  from  time  to  time. 

Section  2.  All  moneys  received  by  the  Trustee  for  the 
sinking  fund  shall  be  applied  by  it  from  time  to  time,  as 
soon  as  reasonably  practicable  after  the  receipt  thereof, 
to  the  purchase  of  Notes  issued  under  this  Indenture  at 
the  best  price  or  prices  obtainable  by  the  Trustee,  not 
exceeding  the  redemption  price  at  the  time  current,  such 
purchase  to  be  made  by  the  Trustee  at  public  or  private 
sale  or  otherwise  and  after  or  without  inviting  tenders 
of  Notes,  as  it  may  in  its  discretion  determine,  at  the  best 
price  or  prices  obtainable  by  it  considering  the  amount  or 
amounts  of  Notes  purchased,  not  exceeding  said  redemp¬ 
tion  price.  The  Company  may  make  any  tenders  or  sales 
of  Notes  to  the  Trustee  for  the  sinking  fund.  The  moneys 
in  the  sinking  fund  not  applied  to  the  purchase  of  Notes 
as  aforesaid  on  or  before  the  1st  day  of  August  in  each 
year  shall  (unless  the  amount  be  less  than  $25,000) 
be  applied  by  the  Trustee  forthwith  to  the  redemption  of 
Notes,  at  the  redemption  price  aforesaid,  the  Notes  so  to 
be  redeemed  to  be  designated  by  lot  under  the  direction 


37 


of  the  Trustee  as  provided  in  Article  Four  hereof.  The 
Notes  so  to  be  redeemed  having  been  so  designated, 
the  Trustee  shall  give  notice  to  the  Company  to  that 
effect  specifying  the  numbers  thereof,  and  the  Company 
shall  forthwith  give  notice  of  such  redemption  as  in  said 
Article  Four  provided  to  be  given  for  the  redemption 
of  Notes  pursuant  to  said  Article;  or  the  Trustee  may, 
at  the  expense  of  the  Company,  give  such  notice.  Said 
notice  having  been  published  as  in  said  Article  Four 
provided,  the  Notes  so  designated  for  redemption  shall 
on  the  date  specified  in  said  notice  become  due  and 
payable  at  said  redemption  price.  From  and  after  the 
date  of  redemption  so  designated  (unless  default  shall 
be  made  in  the  payment  of  said  Notes)  interest  on  the 
Notes  so  designated  for  redemption  shall  cease  to  accrue, 
and  on  surrender  of  the  Notes  specified  in  the  notice 
of  redemption  in  accordance  with  said  notice,  with  all 
appurtenant  coupons  maturing  on  and  after  said  redemp¬ 
tion  date,  if  an  interest  date  or  after  said  date  of  re¬ 
demption  if  not  an  interest  date,  said  Notes  shall  be  paid 
by  the  Trustee  at  the  redemption  price  aforesaid. 

Section  3.  Until  the  designation  by  lot  of  Notes  for 
redemption  as  aforesaid,  all  moneys  in  the  sinking  fund 
shall  be  held  by  the  Trustee  as  security  for  all  the  Notes 
outstanding  under  this  Indenture;  but  from  and  after 
such  designation  all  such  moneys  to  the  extent  required 
for  the  purpose  shall  be  held  for  the  payment  of  the  Notes 
so  designated  for  redemption.  In  case  after  such  designa¬ 
tion  any  of  the  Notes  so  designated  for  redemption  shall 
be  converted  into  common  stock  of  the  Company  pursuant 
to  the  provisions  of  Article  Six  hereof,  then,  upon  the 
request  of  the  Company,  the  Trustee  shall  repay  to  the 
Company  out  of  the  moneys  theretofore  paid  to  it  for  the 
sinking  fund  an  amount  equal  to  the  redemption  price  of 
the  Notes  so  converted. 


38 


Section  4.  All  Notes  purchased  or  redeemed  by  the 
application  of  moneys  in  the  sinking  fund  shall  not  be 
cancelled  but  shall  be  kept  alive  in  the  sinking  fund  and 
shall  continue  to  bear  interest  which  shall  be  credited  to 
the  sinking  fund  to  be  applied  as  hereinbefore  provided. 
All  such  Notes  shall  by  the  Trustee  be  stamped  “Not 
negotiable.  Property  of  the  Sinking  Fund  under  In¬ 
denture  of  American  Sumatra  Tobacco  Company  dated 
June  1,  1920.” 


ARTICLE  SIX. 

Conversion  of  Notes  into  Common  Stock. 

Section  1.  At  the  option  of  the  holders  or  registered 
owners  thereof,  any  and  all  Notes  issued  under  this  In¬ 
denture  may  be  converted  at  their  face  value,  at  any  time 
on  or  after  October  1,  1920,  and  prior  to  the  date  of 
maturity  thereof  (except  as  hereinafter  in  Section  5  of 
this  Article  Six  provided )  into  shares  of  the  common  stock 
of  the  Company,  as  its  common  stock  shall  be  constituted 
at  the  time  of  such  conversion,  at  the  rate  or  rates  stated 
or  determined  as  hereinafter  set  forth  in  Section  4  of  this 
Article  Six,  provided  that  the  respective  holders  or  regis¬ 
tered  owners  of  the  Notes  to  be  converted  shall  have  given 
the  Company,  at  the  said  office  of  the  Trustee  in  the 
Borough  of  Manhattan,  in  the  City  of  New  York,  written 
notice  of  election  to  convert  such  Note  or  Notes  at  least 
five  days  prior  to  the  date  specified  in  such  notice  for 
such  conversion  and,  at  the  time  of  giving  such  notice, 
shall  have  surrendered  to  the  Trustee,  at  its  office  in 
said  Borough  of  Manhattan,  the  Note  or  Notes  to  be 
converted  as  stated  in  said  notice,  together  with  all  then 
unmatured  coupons  thereto  appertaining,  if  coupon  Note 
or  Notes,  any  Note  or  Notes  registered  as  to  principal 
to  be  transferred  in  blank  or  to  bearer  and  any  registered 


39 


Notes  without  coupons  to  be  assigned  in  blank,  prior 
to  such  surrender  thereof.  Said  requirement  of  a  five 
days’  notice  shall  not,  however,  so  operate  as  to  shorten 
the  time  within  which  the  holder  or  registered  owner  of 
Notes  may  exercise  said  conversion  privilege,  which  shall 
be  deemed  to  have  been  exercised  in  respect  of  tbe  Notes 
mentioned  in  any  such  notice,  when  said  notice  shall  have 
been  given  and  said  Notes  and  coupons  shall  have  been 
surrendered,  as  aforesaid. 

Section  2.  In  case  any  fraction  of  a  share  of  said 
common  stock  shall  be  deliverable  upon  any  such  con¬ 
version,  the  Company  shall  have  the  right  to,  and  shall, 
purchase  it  at  the  then  conversion  price,  which  conversion 
price  shall  be  an  amount  in  cash  equal  to  so  much  of  the 
face  amount  of  the  Notes  as  shall  represent  such  frac¬ 
tional  interest.  In  case  the  aggregate  fractions  of  shares 
represented  by  any  Notes  surrendered  for  conversion  shall 
equal  one  or  more  full  shares  of  said  stock,  the  holder  or 
registered  owner  of  such  surrendered  Notes  shall  be  en¬ 
titled  to  receive,  and  the  Company  shall  deliver  to  him, 
one  or  more  certificates  representing  such  full  share  or 
shares  of  said  common  stock  accordingly,  and  the  Com¬ 
pany  shall  have  the  right  to,  and  shall,  purchase  from  the 
holder  or  registered  owner  of  said  surrendered  Notes  the 
excess  fraction  of  a  share,  if  any,  at  the  then  conversion 
price.  At  the  time  of  any  such  conversion,  a  cash  adjust¬ 
ment  shall  be  made  in  the  manner  hereinafter  provided 
between  the  Company  and  the  holder  or  registered  owner 
of  any  Note  surrendered  on  such  conversion  in  respect  of 
the  interest  accrued  on  such  Note  and  any  dividends  on 
the  shares  of  stock  to  be  delivered  in  exchange  therefor. 

Section  3.  The  Company  shall  deliver  from  time  to 
time  to  the  respective  holders  or  registered  owners  of 


40 


Notes  in  respect  of  which  any  notice  as  aforesaid  shall 
have  been  given,  or  to  their  respective  assigns,  and  in 
exchange  therefor,  stock  certificates  representing  the 
number  of  shares  of  stock  into  which  such  Notes  shall  be 
convertible.  The  stock  certificates  so  delivered  shall  be 
in  the  names  of  the  respective  holders  or  registered  owners 
of  Notes  so  surrendered  for  conversion  (or  in  such  names 
as  they  may  direct,  in  which  case  they  shall  pay  all  stock 
transfer  taxes  that  may  he  payable  in  respect  thereof). 
The  Company  shall  pay  the  amount  of  any  and  all  taxes 
which  may  be  imposed  in  respect  of  any  issue  of  delivery 
of  stock  pursuant  to  the  provisions  of  this  Article  Six  and 
which  shall  be  payable  in  order  that  such  stock  may  be 
issued  in  the  name  of  the  respective  holders  or  registered 
owners  of  the  Note  or  Notes  so  surrendered  for  con¬ 
version. 

Section  4.  The  rate  at  which  common  stock  of  the 
Company  shall  be  delivered  on  any  such  conversion  shall 
be  upon  the  basis  of  nine  and  one  half  shares  of  such  stock 
for  a  $1,000  Note  at  any  time  on  or  after  October  1,  1920 
and  up  to  and  including  December  31,  1921  and  thereafter 
at  the  rate  of  nine  shares  of  such  stock  for  a  $1,000  Note. 
If  any  additional  common  stock  is  at  any  time  on  or  prior 
to  December  31,  1921,  issued  by  the  Company  for  less 
than  $104  per  share,  the  rate  at  which  common  stock 
shall  be  delivered  thereafter  either  before  or  after  De¬ 
cember  31,  1921,  on  conversion  shall  be  reduced  to  a  rate 
equivalent  to  the  price  in  money  or  in  fair  value  of  prop¬ 
erty  at  or  for  which  such  common  stock  is  issued  and  if 
not  so  issued  below  $104  per  share  on  or  before  December 
31,  1921,  but  if  issued  thereafter  at  less  than  $109  per 
share  the  conversion  rate  shall  be  likewise  reduced,  and 
if,  in  either  such  event,  any  further  stock  is  subse¬ 
quently  issued  at  a  lower  price  the  conversion  rate 


41 


shall  be  still  further  reduced,  and  s?o  on  from  time  to  time. 
Stock  dividends  payable  in  common  stock  may  be  declared 
and  paid  on  tbe  common  stock  without  affecting  a  reduc¬ 
tion  in  the  conversion  rate  provided  they  do  not  exceed  in 
any  fiscal  year,  together  with  other  dividends  paid  during 
such  fiscal  year,  the  net  earnings  of  the  Company  and  its 
subsidiaries  for  such  year,  and  that  portion  of  the  net 
earnings  of  any  controlled  company  for  that  year  which 
the  stock  of  the  controlled  company  owned  by  the  Com¬ 
pany  is  of  the  total  outstanding  stock  of  the  controlled 
company  (net  earnings  of  subsidiary  companies  and  con¬ 
trolled  companies  to  be  included  only  to  such  extent  as 
the  Company  shall  be  entitled  thereto  after  allowing  for 
preferences  therein  of  preferred  stock  held  by  others 
and  to  deduction  of  such  part  thereof  as  other  common 
stockholders  are  entitled),  and  provided  that  thirty  days 
notice  of  the  declaration  of  such  dividend  prior  to  the  date 
fixed  for  taking  a  record  of  stockholders  for  purposes  of 
such  dividend  shall  be  given  by  publication  in  two  daily 
newspapers  published  in  the  Borough  of  Manhattan,  City 
of  New  York,  once  a  week  for  four  successive  weeks,  and 
each  such  stock  dividend  shall  be  payable  to  all  stock¬ 
holders  of  record  on  such  date  of  record  including  those 
receiving  stock  up  to  such  time  on  conversion  of  Notes. 
Any  greater  stock  dividend  shall  affect  a  reduction  in  the 
conversion  rate  as  hereinbefore  provided.  If  any  com¬ 
mon  stock  is  issued  by  the  Company  at  a  price  greater 
than  $104  per  share  at  a  time  when  the  conversion  rate  is 
nine  and  one-half  shares  of  stock  for  each  $1,000  Note  or 
for  a  price  greater  than  $109  per  share  at  a  time  when 
the  conversion  rate  is  nine  shares  of  stock  for  each  $1,000 
Note,  the  conversion  rate  shall  not  be  increased  so  that 
in  no  event  shall  less  than  nine  and  one-half  shares  for 
each  $1,000  Note  on  or  prior  to  December  31,  1921,  and 
nine  shares  for  each  $1,000  Note  after  December  31,  1921, 


42 


be  deliverable  on  conversion,  and  if  common  stock  is  is¬ 
sued  by  the  Company  at  a  price  in  excess  of  the  conversion 
rate  as  reduced,  as  hereinabove  provided,  the  reduced  con¬ 
version  rate  shall  not  be  increased  on  account  thereof. 
If  any  dispute  shall  arise  between  the  Company  and  any 
holder  or  registered  owner  of  Notes  as  to  the  rate  at 
which  common  stock  is  to  be  delivered  and  received  on 
conversion,  the  same  may  be  conclusively  determined  by 
the  Trustee,  which,  however,  shall  be  under  no  duty  to 
make  such  determination  or  be  liable  to  anyone  either  for 
making  or  for  not  making  the  same. 

Upon  any  such  conversion  there  shall  be  a  cash  adjust¬ 
ment  of  interest  and  of  dividends  accrued.  To  make  the 
cash  adjustment  hereinbefore  mentioned,  of  accrued 
interest  upon  any  Note  surrendered  for  conversion  as 
aforesaid,  and  any  dividends  upon  the  stock  delivered  in 
exchange  therefor,  the  Company  shall,  at  the  time  of  such 
conversion,  pay  to  the  holder  or  registered  owner  of  the 
Note  so  converted,  interest  not  previously  paid  on  said 
Note  at  the  rate  of  seven  and  one-half  per  cent.  (7^%) 
per  annum  to  the  date  of  conversion;  and  also,  in  case 
the  conversion  shall  occur  after  the  declaration,  but  be¬ 
fore  the  payment,  of  a  dividend  upon  the  common  stock  of 
the  Company  in  which  dividend  the  shares  to  be  delivered 
in  exchange  for  the  Note  so  converted  will  not  be  entitled 
to  participate,  an  additional  amount  which,  at  the  cur¬ 
rent  rate  of  dividend  upon  the  common  stock  of  the 
Company,  will  equal  the  dividend  accruing  upon  the 
stock  delivered  in  exchanged  for  the  Note  so  converted 
from  such  date  of  conversion  to  the  date  fixed  for  the 
payment  of  the  dividend  accruing;  and,  except  when 
the  conversion  shall  occur  between  the  dates  aforesaid, 
the  holder  or  registered  owner  of  the  Note  so  converted 
shall,  at  the  same  time,  pay  to  the  Company  an  amount 
which  at  the  current  rate  of  dividends  will  equal  the  divi- 


43 


dend  upon  the  stock  delivered  in  exchange  for  the  Note  so 
converted,  from  the  date  upon  which  the  last  dividend 
upon  the  common  stock  of  the  Company  was  paid  to  the 
date  of  conversion,  provided  that  quarterly  dividends  shall 
have  been  declared  or  paid  for  at  least  six  months  preced¬ 
ing  such  date  of  conversion.  The  last  regular  dividend  de¬ 
clared  by  the  Company  upon  its  common  stock  (exclusive 
of  stock  dividends  and  other  extraordinary  dividends  of 
every  character)  within  six  months  prior  to  the  date  of 
conversion  shall  be  deemed  and  taken  to  determine  the 
current  rate  of  dividends  within  the  meaning  of  this 
Indenture.  The  date  of  the  conversion  and  the  time 
when  the  conversion  shall  occur  for  the  purposes  of  any 
computation  in  this  Section  4  provided,  shall  be  deemed 
to  be  the  date  and  time  when  the  Notes  shall  respectively 
be  surrendered  to  the  Trustee  for  such  conversion. 

Section  5.  The  Company  shall  not  be  required  to  con¬ 
vert  any  Note  issued  hereunder  into  its  common  stock 
while  its  books  for  the  transfer  of  said  stock  shall  be 
closed  for  any  purpose,  and  the  right  of  conversion  here¬ 
inbefore  and  in  the  Notes  provided  for  shall  be  suspended 
during  such  period;  provided,  however,  that  the  right  of 
conversion  shall  not  in  any  case  be  so  suspended  for  a 
longer  period  than  thirty  (  30)  days,  nor  during  the  last 
thirty  (30)  days  of  the  calendar  year  1921,  nor  during 
the  last  thirty  (30)  days  of  the  conversion  period.  In  the 
case  of  Notes  called  for  redemption  pursuant  to  the  pro¬ 
visions  of  Article  Four  or  of  Article  Five  hereof,  said 
right  of  conversion  shall  continue  up  to  the  tenth  day 
next  preceding  the  date  fixed  for  such  redemption,  and 
said  right  of  conversion  shall  not  be  suspended  by  a 
closing  of  the  books  for  the  transfer  of  said  Common 
Stock  during  the  thirty  (30)  days  next  preceding  said 
tenth  day. 


44 


Section  6.  The  Company  covenants  and  agrees  that 
from  time  to  time  and  in  due  course  it  will  take  and  com¬ 
plete  all  such  proceedings  (including  the  listing  of  its 
increased  common  stock  on  the  New  York  Stock 
Exchange)  as  may  be  necessary  or  proper  for  the 
issue  and  delivery  of  its  common  stock  in  such  amounts 
as  may  be  necessary  to  provide  for  the  conversion  into 
said  common  stock  in  accordance  with  the  terms  and 
provisions  hereof  of  all  the  Notes  issued  hereunder  and 
covenants  and  agrees  to  reserve  at  all  times  sufficient  of 
its  common  stock  unissued  to  effect  the  conversion  of  the 
Notes  at  the  rates  as  herein  provided  and  to  reserve  suffi¬ 
cient  additional  shares  unissued  from  time  to  time  in  the 
event  of  the  change  in  such  conversion  rates  as  herein 
provided. 

Section  7.  Upon  the  conversion  of  any  Note  into 
common  stock  as  hereinbefore  provided,  the  Company 
forthwith  shall  cancel  the  surrendered  Note  and  all  un¬ 
matured  coupons  thereto  appertaining  and  shall  exhibit 
the  same  so  cancelled  to  the  Trustee;  thereupon  said  Note 
shall  be  deemed  to  be  and  shall  be  satisfied  and  discharged 
and  no  Note  in  place  thereof  shall  be  issued  by  the  Com¬ 
pany  or  be  authenticated  or  delivered  by  the  Trustee. 

ARTICLE  SEVEN. 

Remedies  of  Trustee,  Noteholders  Committee  and 
Noteholders. 

Section  1.  The  following  events  shall  be  events  of 
default  under  this  Indenture,  and  the  words  “event  of 
default”  or  “events  of  default'^  shall  mean,  whether  the 
same  are  used  in  this  Indenture  or  in  said  Notes,  one 
or  more  of  the  following  events: 

(a)  If  default  shall  be  made  in  the  payment  of 
any  instalment  of  interest  on  any  of  the  Notes, 


45 


when  and  as  the  same  shall  become  due  and  pay¬ 
able,  and  such  default  shall  have  continued  for 
a  period  of  sixty  days; 

(6)  If  default  shall  be  made  in  the  payment  of 
any  instalment  of  the  sinking  fund  hereinbefore 
provided  for,  and  such  default  shall  have  continued 
for  a  period  of  sixty  days ; 

(c)  If  default  shall  be  made  in  payment  of  the 
principal  of  any  of  the  Notes,  when  and  as  the 
same  shall  become  due  and  payable,  whether  at 
maturity  or  by  declaration  or  acceleration  or 
otherwise; 

(d)  If  an  order  shall  be  made  for  the  appoint¬ 
ment  of  a  receiver  or  receivers  of  the  Company,  or 
of  any  subsidiary  company,  or  of  the  properties  or 
of  any  substantial  part  thereof  of  either  of  them 
by  a  court  of  competent  jurisdiction  and  any  such 
order  shall  have  continued  in  effect  for  a  period  of 
thirty  days,  or  for  the  appointment  of  a  trustee  in 
bankruptcy  for  the  Company,  or  for  any  subsidiary 
company,  or  for  the  segregation  of  the  assets  or 
the  winding-up  or  liquidation  of  the  business  and 
affairs  of  either  of  them,  or  in  case  corporate 
action  shall  be  taken  or  permitted,  or  suffered  to 
be  taken,  on  the  part  of  the  Company,  or  of  any 
subsidiary  company,  or  the  Company,  or  any  sub¬ 
sidiary  company,  shall  procure  measures  to  be 
taken  for  any  of  the  aforesaid  purposes; 

( c )  If  any  of  the  important  property  of  the 
Company,  or  of  any  subsidiary  company,  shall  be 
seized  upon  any  writ  of  attachment  or  other  legal 
process  and  it  shall  not  within  thirty  days  there¬ 
after  cause  such  property  to  be  released  and  dis- 


46 


charged  therefrom  by  giving  bond  or  otherwise, 
or  in  case  any  judgment  recovered  against  the 
Company,  or  any  subsidiary  company,  shall 
remain  in  force  without  a  stay  of  proceedings 
thereon  and  unsatisfied  or  unsecured  by  an  under¬ 
taking  on  appeal  for  a  period  of  thirty  days  after 
the  entry  thereof ; 

(/)  If  default  shall  be  made  by  the  Company  in 
not  observing  and  complying  with  the  provisions, 
or  any  of  them,  of  Section  5,  Section  7,  Section  8 
and  Section  9  of  Article  Three  of  this  Indenture; 

(g)  If  default  shall  be  made  by  the  Company  in 
the  observance  or  performance  of  any  of  the  terms, 
conditions,  agreements  or  provisions  that  may  be 
hereafter  prescribed  by  the  Noteholders’  Commit¬ 
tee  in  connection  with  any  consent,  waiver  or  con¬ 
cession  of  the  Noteholders’  Committee  given  here¬ 
under  in  any  case,  and  the  Company  has  accepted 
said  terms,  conditions,  agreements  or  provisions  by 
acting  upon  such  consent,  waiver  or  concession  or 
otherwise; 

(/<■)  If  default  shall  be  made  in  the  observance 
or  performance  of  any  other  of  the  covenants,  con¬ 
ditions  and  agreements  on  the  part  of  the  Com¬ 
pany,  in  the  said  Notes  or  in  this  Indenture  con¬ 
tained,  and  such  default  shall  continue  for  a 
period  of  thirty  days  after  written  notice  to  the 
Company  from  the  Trustee  or  from  the  Note¬ 
holders  Committee  specifying  such  default  and 
requiring  the  same  to  be  remedied. 


Section  2.  If  any  one  or  more  of  the  events  of  default 
shall  happen,  then  and  in  every  such  case  the  Trustee,  by 
a  notice  in  writing  mailed  to  the  Company  by  regis- 


47 


tered  mail  addressed  to  the  Company  at  No.  142  Water 
Street,  in  the  Borough  of  Manhattan,  City  and  State  of 
New  York,  (or  at  any  other  address  furnished  at  any 
time  by  the  Company  to  the  Trustee  for  the  purpose) 
may,  and  upon  the  written  request  of  said  Noteholders’ 
Committee  shall,  declare  the  principal  of  all  of  the 
said  Notes  then  outstanding,  and  interest  thereon,  if 
not  already  due,  to  be  due  and  payable  immediately,  and 
upon  any  such  mailing  of  such  notice  in  writing,  the 
same  shall  become  and  be  immediately  due  and  payable, 
anything  in  this  Indenture  or  in  said  Notes  contained  to 
the  contrary  notwithstanding. 

This  provision,  however,  is  subject  to  the  condition 
that  if  at  any  time  after  the  principal  of  the  Notes  shall 
have  so  become  due  and  payable,  and  prior  to  the  date  of 
maturity  thereof  stated  in  the  Notes,  all  arrears  of  in¬ 
terest,  if  any,  upon  all  the  Notes  (with  interest  at  the  rate 
of  seven  and  one-half  per  cent,  per  annum  on  any  overdue 
interest) ,  and  the  expenses  of  the  Trustee,  shall  be  paid  by 
the  Company,  and  every  other  existing  event  of  default 
not  waived  by  the  Committee  as  herein  permitted  shall  be 
made  good  or  be  secured  to  the  satisfaction  of  the  Note¬ 
holders  Committee,  or  provision  deemed  by  the  Commit¬ 
tee  to  be  adequate  shall  be  made  therefor,  then  and  in 
every  such  case  the  Committee,  by  written  notice  to  the 
Company  and  to  the  Trustee,  may  waive  the  default  by 
reason  of  which  the  principal  of  the  Notes  shall  have  so 
become  due  and  payable,  and  may  rescind  and  annul  such 
declaration  and  its  consequences;  but  no  such  waiver, 
rescission  or  annulment  shall  extend  to  or  affect  any  sub¬ 
sequent  default  or  impair  any  right  consequent  thereon. 

Section  3.  If  one  or  more  of  the  events  of  default 
shall  happen,  the  Trustee,  personally  or  by  attorney,  in 
its  discretion  may  proceed  to  protect  and  to  enforce  its 


48 


rights  and  the  rights  of  noteholders  under  this  Indenture, 
by  a  suit  or  suits  in  equity  or  at  law,  whether  for  the 
specific  performance  of  any  covenant  or  agreement  con¬ 
tained  herein,  or  in  aid  of  the  execution  of  any  power 
herein  granted,  or  for  the  enforcement  of  any  other  appro¬ 
priate  legal  or  equitable  remedy,  as  the  Trustee,  being 
advised  by  counsel  learned  in  the  law,  shall  deem  most 
effectual  to  protect  and  enforce  any  of  its  rights  or  duties 
hereunder. 

Section  4.  In  case  one  or  more  of  the  events  of  default 
shall  happen,  upon  the  written  request  of  the  said  Com¬ 
mittee  it  shall  be  the  duty  of  the  Trustee,  upon  being 
indemnified  to  its  satisfaction,  to  take  all  steps  so  re¬ 
quested  for  the  protection  and  enforcement  of  its  rights 
and  the  rights  of  the  holders  of  the  Notes  and  coupons, 
and  to  take  appropriate  judicial  proceedings  by  action, 
suit  or  otherwise  as  shall  be  so  requested  by  said  Com¬ 
mittee;  and  anything  in  this  Indenture  to  the  contrary 
notwithstanding  to  such  extent  as  shall  be  lawful  said 
Committee  shall  have  the  right  to  direct  and  to  control 
the  method  and  place  of  conducting  any  and  all  pro¬ 
ceedings. 

Section  5.  In  case 

(1)  default  shall  be  made  in  the  payment  of. 
any  instalment  of  interest  on  any  of  the  Notes  at 
any  time  outstanding  under  this  Indenture,  and 
such  default  shall  have  continued  for  a  period  of 
sixty  days;  or 

(2)  default  shall  be  made  in  the  payment  of 
the  principal  of  any  of  the  Notes,  when  and  as 
same  shall  become  payable,  whether  at  maturity 
or  by  declaration  or  otherwise, 


49 


then,  upon  demand  of  the  Trustee  or  the  Committee,  the 
Company  will  pay  to  the  Trustee  for  the  benefit  of  the 
holders  and  registered  owners  of  the  Notes  and  coupons 
issued  hereunder  and  then  outstanding,  the  whole  amount 
which  then  shall  have  become  due  and  payable  on  all  such 
Notes  and  coupons  then  outstanding  for  interest  or  prin¬ 
cipal  or  both,  as  the  case  may  be,  with  interest  at  the  rate 
of  seven  and  one-half  per  cent,  per  annum  upon  the  over¬ 
due  Notes  and  overdue  interest;  and  in  addition  thereto 
such  further  amount  as  shall  be  sufficient  to  cover  the 
cost  and  expenses  of  collection,  including  a  reasonable 
compensation  to  the  Trustee,  its  agents,  attorneys  and 
counsel  and  any  expenses  or  liabilities  incurred  by  the 
Trustee  hereunder  and  the  reasonable  compensation  of 
the  Committee.  Until  such  demand  shall  be  made  by 
the  Trustee  or  the  Committee,  the  Company  may  pay 
the  principal  and  interest  of  the  Notes  to  the  holders 
and  registered  owners  thereof,  and  shall  not  be  affected 
by  any  notice  to  the  contrary,  whether  the  Notes  are  over¬ 
due  or  not.  If,  however,  demand  shall  be  so  made,  pay¬ 
ment  of  the  Notes  or  of  the  coupons  shall  be  made  there¬ 
after  only  to  the  Trustee. 

Section  6.  In  case  the  Company  shall  fail  forthwith 
to  pay  such  amounts  upon  such  demand,  the  Trustee  in 
its  own  name  and  as  trustee  of  an  express  trust  shall  be 
entitled  and  empowered  to  institute  such  action  or  pro¬ 
ceedings  at  law  or  in  equity  as  may  be  advised  by  counsel 
for  the  collection  of  the  sums  so  due  and  unpaid,  and  may 
prosecute  any  such  action  or  proceedings  to  judgment  or 
final  decree,  and  may  enforce  any  such  judgment  or  final 
decree  against  the  Company,  and  collect  the  moneys  ad¬ 
judged  or  decreed  to  be  payable  out  of  the  property  of  the 
Company  wherever  situated,  in  the  manner  provided  by 
law. 


50 


Section  7.  All  rights  of  action  under  this  Indenture 
or  on  any  of  the  Notes  or  coupons  may  be  enforced  by 
the  Trustee  without  the  possession  of  any  of  the  Notes  or 
coupons  or  the  production  thereof  on  any  trial  or  other 
proceedings  relative  thereto,  and  any  such  suit  or  pro¬ 
ceedings  instituted  by  the  Trustee  shall  be  brought  in  its 
name  as  Trustee  and  any  recovery  of  judgment  shall  be 
for  the  ratable  benefit  of  the  holders  or  registered  owners 
of  the  Notes  and  coupons. 

Section  S.  Any  moneys  collected  by  the  Trustee  under 
this  Article  Seven  shall  be  applied  by  the  Trustee  as 
follows : 

First.  To  the  payment  of  costs  and  expenses, 
including  a  reasonable  compensation  to  the  Trus¬ 
tee,  its  agents,  attorneys  and  counsel,  and  the  Com¬ 
mittee,  and  of  all  expenses,  liabilities  and  advances 
incurred  or  made  by  the  Trustee  and  the  Commit¬ 
tee  hereunder. 

Second.  To  the  payment  of  the  amounts  then 
due  and  unpaid  upon  the  Notes  and  coupons  in 
respect  of  which  such  moneys  shall  have  been  col¬ 
lected,  ratably  and  without  preference  or  priority 
of  any  kind,  according  to  the  amounts  due  and  pay¬ 
able  upon  such  Notes  and  coupons,  respectively, 
at  the  date  fixed  by  the  Trustee  for  the  distribu¬ 
tion  of  such  moneys,  upon  presentation  of  the  sev¬ 
eral  Notes  and  coupons  and  stamping  thereon  the 
payment,  if  only  partially  paid,  and  upon  the  sur¬ 
render  and  cancellation  thereof,  if  fully  paid. 

These  provisions,  however,  are  not  intended  in  any 
wise  to  modify  the  provisions  of  Section  15  of  Article 
Three  of  this  Indenture,  but  are  subject  thereto. 


51 


Section  9.  The  Trustee  shall,  upon  the  written  re¬ 
quest  of  the  Committee,  waive  any  default  hereunder  and 
its  consequences,  except  (1)  a  default  in  the  covenants 
contained  in  Article  Six  of  this  Indenture  providing  for 
the  conversion  of  Notes  into  common  stock  of  the  Com¬ 
pany  and  (2)  a  default  in  the  payment  of  the  principal 
of  the  Notes  at  the  date  of  maturity  expressed  therein, 
and  (3)  a  default  in  the  payment  of  interest  on  the 
Notes  (unless  prior  to  any  such  waiver  of  a  default  in 
the  payment  of  interest,  all  arrears  of  interest,  with 
interest  at  the  rate  of  seven  and  one-half  per  cent,  per 
annum  on  overdue  instalments  of  interest,  and  all 
expenses  of  the  Trustee  shall  have  been  paid  by  the 
Company  or  shall  have  been  provided  for  by  a  deposit 
with  the  Trustee  of  a  sum  sufficient  to  pay  the  same, 
in  which  case  the  Trustee  may  waive  a  default  in  the  pay¬ 
ment  of  interest)  and  (4)  a  default  in  the  covenant  of 
the  Company  contained  in  Section  7  of  Article  Three  of 
this  Indenture  not  to  declare  or  pay  dividends  on  its 
common  stock  after  September  30,  1920,  when  the  ratio 
between  its  net  quick  assets  and  the  face  amount  of  the 
Notes  therein  mentioned  does  not  obtain,  or  when  by  the 
payment  of  any  such  dividend  its  net  quick  assets  are 
reduced  below  such  ratio.  Any  default  of  the  Company 
in  its  covenant  contained  in  said  Section  7  of  Article 
Three  not  to  pay  dividends  on  its  preferred  stock  when 
said  ratio  is  not  maintained  may  be  waived  under  the  pro¬ 
visions  of  this  Section.  In  case  of  any  such  waiver,  or 
in  case  any  proceedings  taken  on  account  of  any  such 
default  shall  have  been  discontinued  or  abandoned  or 
determined  adversely  to  the  Trustee,  then  and  in  every 
such  case,  the  Company,  the  Trustee  and  the  Committee, 
and  the  holders  and  registered  owners  of  the  Notes,  shall 
be  restored  to  their  former  positions  and  rights  hereunder 
respectively,  but  no  such  waiver  shall  extend  to  any  sub¬ 


s' 

i 


k 


U.  OF  ILL.  LIB. 


52 


sequent  or  other  default  or  impair  any  right  consequent 
thereon. 

Section  10.  In  order  to  promote  and  to  protect  the 
equal  ratable  rights  of  every  holder  or  registered  owner 
of  the  Notes  to  be  issued  under  this  Indenture,  and  to 
avoid  multiplicity  of  suits,  it  is  expressly  covenanted  and 
agreed  that,  except  as  is  hereinafter  provided  in  respect 
of  the  right  of  conversion  thereof,  all  the  Notes  issued 
hereunder  are  subject  to  the  condition  that  all  rights  of 
action  thereon,  or  in  respect  thereof,  or  on  or  in  respect 
of  the  coupons  thereto  appertaining,  are  vested  exclusively 
in  the  Trustee  under  this  Indenture,  and  that  no  holder  or 
registered  owner  of  any  Notes,  or  of  any  coupon  apper¬ 
taining  thereto,  shall  have  any  right  to  institute  any 
action  at  law  or  in  equity  upon  the  Notes  or  any  of  the 
appurtenant  coupons,  or  growing  out  of  any  provision 
thereof,  or  of  this  Indenture,  or  for  the  enforcement  of 
this  Indenture,  unless  and  until  the  Trustee  shall  refuse 
or  neglect  to  institute  proper  proceedings  by  way  of 
remedy  within  a  period  of  sixty  days  after  request  of  the 
Committee  or  the  holders  or  registered  owners  of  one- 
fourth  iu  principal  amount  of  the  Notes  then  outstand¬ 
ing,  filed  with  the  Trustee,  with  offer  of  indemnity  satis¬ 
factory  to  the  Trustee ;  and  any  recovery  in  any  action  or 
proceeding  instituted  by  the  holder  or  registered  owner 
of  any  Note,  shall  be  for  the  equal  pro  rata  benefit  of  all 
outstanding  Notes  similarly  situated;  provided,  however, 
that  nothing  herein  contained  shall  affect  the  right  of  the 
holder  or  registered  owner  of  any  Note  to  enforce  pay¬ 
ment  thereof  at  and  after  the  date  of  maturity  iu  said 
Note  expressed;  and  provided,  further,  that  the  holder 
or  registered  owner  of  any  Note,  without  reference  to, 
or  the  consent  of,  either  the  Trustee  or  the  holder  or 
registered  owner  of  any  other  Note,  may,  in  his  own 


53 


behalf  and  for  his  own  benefit,  enforce,  and  may  institute 
and  maintain  any  proceedings  suitable  to  enforce,  his 
right  to  convert  his  Note  into  the  common  stock  of  the 
Company  in  accordance  with  the  provisions  of  Article 
Six  of  this  Indenture. 

Section  11.  No  delay  or  omission  of  the  Trustee,  or 
of  any  holder  or  registered  owner  of  Notes,  or  the  Com¬ 
mittee,  to  exercise  any  right  or  power  accruing  upon 
any  default,  occurring  and  continuing  as  aforesaid,  shall 
impair  any  such  right  or  power,  or  shall  be  construed 
to  be  a  waiver  of  any  such  default  or  an  acquiescence 
therein;  and  every  power  and  remedy  given  by  this 
Indenture  to  the  Trustee  or  the  Committee,  or  to  the 
holders  and  registered  owners  of  Notes  may  be  exercised 
from  time  to  time  and  as  often  as  may  be  deemed  expe¬ 
dient  by  it  or  by  them. 

Section  12.  Nothing  in  this  Indenture,  expressed  or 
implied,  is  intended  or  shall  be  construed  to  confer  upon, 
or  to  give  to  any  person  or  corporation  other  than  the 
parties  hereto  and  the  holders  and  registered  owners  of 
the  Notes  and  the  appurtenant  coupons,  and  the  Com¬ 
mittee,  any  right,  remedy  or  claim,  under  or  by  reason 
of  this  Indenture  or  any  covenant,  condition  or  stipulation 
hereof,  and  all  the  covenants,  stipulations,  promises  and 
agreements  in  this  Indenture  contained  shall  be  for  the 
sole  and  exclusive  benefit  of  the  parties  hereto  and  their 
successors,  and  of  the  holders  and  registered  owners  of 
the  Notes  and  coupons  and  the  Committee. 

Section  13.  No  recourse  under  or  upon  any  obliga¬ 
tion,  covenant  or  agreement  of  this  Indenture  or  of  any 
Note  or  coupon,  or  because  of  the  creation  of  any 
indebtedness  represented  by  the  Notes  or  coupons,  shall 


54 


he  had  against  any  stockholder,  officer  or  director  of  the 
Company,  or  of  any  successor  corporation,  as  such,  either 
directly  or  through  the  Company,  or  such  successor  cor¬ 
poration,  by  the  enforcement  of  any  assessment  or  by  any 
legal  or  equitable  proceeding  by  virtue  of  any  constitu¬ 
tional  provision,  statute  or  rule  of  law  or  otherwise. 
This  Indenture  and  the  Notes  and  coupons  are  solely  cor¬ 
porate  obligations,  and  no  personal  liability  whatever 
shall  attach  to,  or  be  incurred  by,  the  stockholders,  or 
any  officers  or  directors  of  the  Company,  or  of  any  suc¬ 
cessor  corporation,  as  such,  or  any  of  them,  because  of  the 
incurring  of  the  indebtedness  hereby  authorized  or  under 
or  by  reason  of  any  of  the  obligations,  covenants  or  agree¬ 
ments  contained  in  this  Indenture  or  in  any  of  the  Notes 
or  coupons  or  implied  therefrom;  and  any  and  all  per¬ 
sonal  liability  of  any  such  stockholder,  officer  or  director, 
as  such,  whether  arising  at  common  law  or  in  equity,  or 
created  by  statute  or  constitution,  is  waived  as  a  con¬ 
dition  of,  and  as  a  part  of  the  consideration  for,  the  exe¬ 
cution  and  delivery  of  this  Indenture  and  the  issue  of  the 
Notes  and  coupons. 

Section  14.  The  Company  will  not  at  any  time  insist 
upon,  or  plead,  or  in  any  manner  whatever  claim  or  take 
the  benefit  or  advantage  of,  any  stay  or  extension  law 
wherever  enacted,  now  or  at  any  time  hereafter  in  force, 
which  may  affect  the  covenants  and  terms  of  performance 
of  this  Indenture;  and  the  Company  hereby  expressly 
waives  all  benefit  or  advantage  of  any  such  law  or  laws, 
aud  covenants  that  it  will  not  hinder,  delay  or  impede 
the  execution  of  any  power  herein  granted  and  delegated 
to  the  Trustee,  but  will  suffer  and  permit  the  execution 
of  every  power  as  though  no  such  law  or  laws  had  been 
made  or  enacted. 


55 


Section  15.  Except  as  herein  expressly  provided  to 
the  contrary,  no  remedy  herein  conferred  upon  or  re¬ 
served  to  the  Trustee,  to  the  Committee,  or  to  the  holders 
of  Notes  or  coupons,  is  intended  to  he  exclusive  of  any 
other  remedy  or  remedies,  and  each  and  every  such  rem¬ 
edy  shall  be  cumulative  and  shall  be  in  addition  to  every 
other  remedy  given  herein  or  now  or  hereafter  exist¬ 
ing  at  law  or  in  equity  or  by  statute. 

Section  16.  Upon  any  sale  made  under  or  in  ac¬ 
cordance  with  any  direction  contained  in  any  judgment 
for  the  recovery  of  any  indebtedness  evidenced  by  said 
Notes  or  coupons  or  claims  for  interest  hereunder,  any 
purchaser  shall  be  entitled  in  making  settlements  or 
payments  of  the  purchase  price  of  the  property  purchased 
to  present  to  the  person  or  persons  authorized  to  receive 
the  payment  of  such  purchase  price,  and  to  turn  in  and 
use  any  of  the  Notes  and  coupons  and  claims  for  interest 
thereon  issued  hereunder,  then  payable,  said  Notes  or 
coupons  or  claims  for  interest  or  all  thereof  being  com¬ 
puted  for  that  purpose  at  a  sum  equal  to,  and  not  exceed¬ 
ing,  that  which  shall  be  payable  out  of  the  net  proceeds 
of  such  sale  to  such  purchaser  as  the  holder  thereof  for 
his  just  share  and  proportion  of  said  net  proceeds ;  and 
if  the  proportion  so  payable  in  respect  of  such  Notes  and 
coupons  and  claims  for  interest  shall  be  less  than  the 
amount  for  which  the  Company  may  be  liable  thereon 
under  direction  of  any  person  so  authorized  to  receive 
payment  of  the  purchase  price,  then  the  amount  to  be 
so  allowed  or  credited  thereon  shall  constitute  such  par¬ 
tial  payment  and  settlement  and  shall  be  conclusive 
proof  of  the  amount  thereof.  At  any  such  sale,  the  Trus¬ 
tee,  as  such,  or  any  noteholder  or  noteholders,  or  the 
Noteholders  Committee,  as  such,  or  any  member  thereof, 
or  any  firm,  company,  or  bank  with  which  any  member 


56 


thereof  shall  be  associated,  may  bid  for  and  purchase  the 
property  sold,  and  may  make  payment  therefor  as  afore¬ 
said,  and  any  noteholder  or  noteholders  or  any  mem¬ 
ber  of  such  Committee,  or  any  such  firm,  company  or 
bank  so  purchasing  any  such  property  upon  compliance 
with  the  terms  of  sale,  may  hold,  retain  and  dispose  of 
such  property  without  further  accountability. 

Section  17.  Upon  the  happening  of  any  of  the  events 
of  default,  the  Trustee  shall  be  entitled,  if  it  or  the 
Committee  so  elect,  as  a  matter  of  right  forthwith  and 
without  precipitation  of  maturity  of  the  Notes  issued 
hereunder,  or  after  precipitation  of  maturity  of  the 
same,  to  the  appointment  of  a  receiver  of  all  the  prop¬ 
erty,  interests,  rights  and  business  of  the  Company  and 
of  all  of  the  earnings,  rents,  issues  and  profits  thereof, 
with  such  powers  as  the  Court  making  such  appoint¬ 
ment  shall  confer  ;  and,  in  any  case  of  the  appointment 
of  a  receiver  as  authorized  by  any  provision  of  this  In¬ 
denture,  the  powers  to  be  conferred  upon  such  receiver  by 
the  Court  making  such  appointment  may  include,  if  the 
Committee  approves,  among  others,  not  only  power  to 
enter  upon  and  possess  and  exclude  others  from  all  of 
the  property,  interests,  rights  and  business  of  the  Com¬ 
pany,  but  likewise  the  power  and  authority  at  the  ex¬ 
pense  of  the  fund  to  use  and  operate  said  property  in 
the  business  theretofore  conducted  by  the  Company,  and 
to  manage  and  control  the  same  and  conduct  the  busi¬ 
ness  thereof  personally  or  by  agents  and,  at  the  expense 
of  the  fund,  to  maintain,  repair,  restore,  renew,  replace 
and  keep  insured  all  such  property  to  the  same  extent 
as  is  usual  with  companies  engaged  in  business  of  the 
same  general  class,  and  likewise,  at  the  expense  of  the 
fund,  to  make  all  necessary  or  proper  alterations,  better¬ 
ments  and  improvements  thereof  and  additions  thereto 


57 


as  to  the  Court  appointing  such  receiver  may  seem 
judicious,  and  to  manage  all  said  property  and  exer¬ 
cise  all  of  the  rights  and  powers  of  the  Company,  either 
in  the  name  of  the  Company  or  otherwise,  and  to  col¬ 
lect  and  receive  all  of  the  income,  rents,  issues  and  profits 
of  said  property,  interests  and  rights  and  every  part 
thereof. 


ARTICLE  EIGHT. 

Concerning  the  Trustee. 

Section  1.  The  Trustee  accepts  the  trusts  of  this 
Indenture  and  agrees  to  execute  them  upon  the  following 
terms  and  conditions,  to  which  the  parties  hereto,  the 
Committee  and  the  holders  and  registered  owners  of  the 
Notes  agree: 

The  Trustee  shall  be  entitled  to  reasonable  com¬ 
pensation  for  all  services  rendered  by  it  in  the 
execution  of  the  trusts  hereby  created,  and  such 
compensation,  as  well  as  the  reasonable  compen¬ 
sation  of  its  counsel  and  of  such  persons  as  it  may 
employ  in  the  administration  or  management  of 
the  trust,  and  all  other  reasonable  expenses  neces¬ 
sarily  incurred  and  actually  disbursed  hereunder, 
the  Company  agrees  to  pay. 

Unless  and  until  the  Trustee  shall  have  re¬ 
ceived  written  notice  to  the  contrary  from  the 
holders  or  registered  owners  of  not  less  than 
twenty-five  per  cent,  in  principal  amount  of  the 
Notes  at  the  time  outstanding,  or  the  Committee, 
the  Trustee  may,  for  all  the  purposes  of  this  Inden¬ 
ture,  assume  that  the  Company  is  not  in  default 
under  this  Indenture  and  that  none  of  the  events 
hereinbefore  denominated  events  of  default  has 
happened. 


58 


The  Trustee  shall  not  be  under  any  obligation 
to  take  any  action  toward  the  execution  or  enforce¬ 
ment  of  the  trusts  hereby  created  which,  in  its 
opinion,  will  be  likely  to  involve  it  in  expense  or 
liability,  unless  one  or  more  of  the  holders  or 
registered  owners  of  the  Notes  or  the  Committee 
shall,  as  often  as  required  by  the  Trustee,  furnish 
it  reasonable  security  and  indemnity  against  such 
expense  or  liability;  or  to  take  any  action  in  re¬ 
spect  of  any  default,  involving  expense  or  liability, 
unless  requested  by  an  instrument  in  writing 
signed  by  the  holders  or  registered  owners  of  not 
less  than  twenty-five  per  cent,  in  principal  amount 
of  the  Notes  at  the  time  outstanding,  or  the  Com¬ 
mittee,  and  unless  tendered  reasonable  security 
and  indemnity  as  aforesaid,  anything  herein  con¬ 
tained  to  the  contrary  notwithstanding;  but  neither 
any  such  notice  or  request,  nor  this  provision  there¬ 
for,  shall  affect  any  discretion  herein  given  to  the 
Trustee  to  determine  whether  or  not  the  Trustee 
shall  take  action  in  respect  to  such  default  or  to 
take  action  without  such  request. 

The  Trustee  shall  incur  no  liability  to  any  one 
in  acting  upon,  or  in  accordance  with,  any  notice, 
request,  opinion,  consent,  certificate,  bond  or  other 
instrument  or  paper  believed  by  it  to  be  genuine 
and  to  have  been  signed  or  presented  by  the 
proper  person  or  duly  authorized  or  properly 
made. 

The  Trustee  may  employ  agents  or  attorneys 
in  fact,  and  shall  not  be  answerable  for  the  default 
or  misconduct  of  any  agent  or  attorney  appointed 
by  it  in  pursuance  hereof,  if  such  agent  or  attorney 
shall  have  been  selected  with  reasonable  care,  nor 
for  anything  whatever  in  connection  with  this 


59 


trust,  except  willful  misconduct  or  gross  negli¬ 
gence. 

It  shall  in  no  event  be  liable  for  any  act  or 
omission  of  the  Noteholders  Committee. 

Any  action  by  the  Trustee  upon  the  request  of 
any  person  who  at  the  time  is  the  holder  or  reg¬ 
istered  owner  of  any  such  Notes,  shall  be  con¬ 
clusive  and  binding  upon  all  future  holders  or 
registered  owners  of  the  same  Notes. 

This  Indenture  need  not  be  recorded,  regis¬ 
tered  or  filed  by  the  Trustee. 

The  Trustee  may  receive  a  certificate  under 
the  corporate  seal  of  the  Company  and  signed  by 
the  Secretary  or  an  Assistant  Secretary  of  the 
Company  as  sufficient  evidence  of  the  due  adoption 
of  any  resolution  by  the  board  of  directors  or 
executive  committee  or  other  committee  of  the 
Company.  The  Trustee  may  rely  upon,  and  shall 
incur  no  liability  for  any  action  taken  by  it  in 
reliance  upon,  any  such  certificate  or  resolution  so 
certified. 

The  Trustee  shall  be  reimbursed  by  the  Com¬ 
pany  upon  demand  for,  and  be  indemnified  against, 
any  liability  or  damages  which  may  be  sustained 
by  it  in  the  premises.  The  Trustee  shall  have  a 
claim  prior  to  that  of  the  holder  or  registered 
owner  of  any  Note  or  the  holder  of  any  coupon 
issued  hereunder  for  its  compensation  and  ex¬ 
penses,  and  also  for  any  liability  or  damage  by  it 
sustained  in  the  premises,  which  claim  shall  be 
a  paramount  lien  upon  any  money  or  other  prop¬ 
erty  at  any  time  coming  into  its  hands  hereunder. 

The  Trustee  makes  no  undertaking  in  respect 
of,  and  shall  not  be  responsible  in  any  manner 
whatsoever  for,  the  validity  or  execution  of  this 


60 


Indenture  or  of  any  of  the  Notes  issued  hereunder 
or  of  the  recitals  herein  or  in  the  Notes  contained, 
all  such  recitals  being  made  and  to  be  taken  as 
statements  of  the  Company  solely;  nor  shall  the 
Trustee  be  accountable  or  responsible  for  the  use 
of  any  Notes  authenticated  and  delivered  here¬ 
under,  or  for  the  performance  or  fulfillment  of  any 
covenant  or  agreement  herein  provided  to  be  kept 
by  the  Company. 

The  Trustee  hereunder  may  from  time  to  time 
purchase,  acquire,  hold,  own  and  deal  in  any  of  the 
Notes  issued  hereunder,  and  assert  its  right  in 
respect  thereof  in  the  same  manner  as  any  other 
holder  of  Notes  issued  hereunder. 

Any  moneys  received  by  the  Trustee  under  any 
provision  of  this  Indenture,  may  be  treated  by  it, 
until  it  is  required  to  pay  out  the  same  conform¬ 
ably  herewith,  as  a  general  deposit,  without  any 
liability  for  interest,  save  as  may  be  agreed  upon 
between  the  Company  and  the  Trustee. 

The  Trustee  at  the  expense  of  the  Company 
may  advise  with  legal  counsel  and  shall  be  pro¬ 
tected  in  respect  of  any  action  under  this  In¬ 
denture  taken  in  good  faith  by  the  Trustee  in 
accordance  with  the  opinion  of  counsel. 

The  Trustee  shall  be  under  no  obligation  or 
liability  to  any  one  for  acting  upon  or  in  accord¬ 
ance  with  any  request  or  direction  of  the  Note¬ 
holders  Committee,  but  the  Trustee  shall  not  be 
obliged  to  follow  any  such  request  or  direction  if, 
in  its  opinion,  upon  advice  of  counsel,  such  re¬ 
quest  or  direction  is  not  within  the  powers  of  the 
Committee  hereunder. 


* 


61 


Section  2.  The  Trustee  may  resign,  and  be  discharged 
from  the  trusts  created  by  this  Indenture,  by  giving  to 
the  Company  notice  in  writing,  and  to  the  holders  and 
registered  owners  of  the  Notes  notice  by  publication,  of 
such  resignation,  specifying  a  date  when  such  resignation 
shall  take  effect,  which  notice  shall  be  published  at  least 
once,  not  less  than  thirty  days  nor  more  than  sixty  days, 
prior  to  the  date  so  specified,  in  a  daily  newspaper  of 
general  circulation  published  in  the  Borough  of  Manhat¬ 
tan,  in  the  City  of  New  York.  Such  resignation  shall 
take  effect  on  the  day  specified  in  such  notice,  unless 
previously  a  successor  trustee  shall  be  appointed  as  here¬ 
inafter  provided,  in  which  event  such  resignation  shall 
take  effect  immediately  upon  the  appointment  of  such 
successor  trustee. 

Section  3.  Any  trustee  hereunder  may  be  removed  at 
any  time  by  an  instrument  or  concurrent  instruments 
filed  with  the  Trustee  and  executed  by  the  holders  or  reg¬ 
istered  owners  of  three-fourths  in  principal  amount  of 
the  Notes  at  the  time  outstanding  or  executed  by  the 
Committee. 

Section  4.  In  case  at  any  time  the  Trustee  shall 
resign  or  shall  be  removed  or  otherwise  shall  become  inca¬ 
pable  of  acting,  a  successor  may  be  appointed  by  the  hold¬ 
ers  or  registered  owners  of  a  majority  in  principal 
amount  of  the  Notes  at  the  time  outstanding,  by  an 
instrument  or  concurrent  instruments  signed  by  such 
holders  and  registered  owners,  or  their  attorneys  in  fact 
thereunto  duly  authorized;  but  until  a  new  trustee  shall 
be  appointed  by  the  holders  and  registered  owners  of  the 
Notes  as  herein  authorized,  the  Committee  by  an  instru¬ 
ment  executed  by  a  majority  of  its  members  (one  original 
whereof  shall  be  lodged  with  the  successor  Trustee  thereby 


62 


appointed  and  one  with  the  retiring  Trustee),  may  ap¬ 
point  a  trustee  to  till  such  vacancy.  Every  such  successor 
trustee,  whether  appointed  by  the  holders  and  registered 
owners  of  the  Notes  or  by  the  Committee  shall  always 
be  a  national  or  state  bank  or  trust  company  having  an 
office  in  the  Borough  of  Manhattan,  in  the  City  of  New 
York,  and  having  a  capital  and  surplus  aggregating  at 
least  two  million  dollars.  After  any  such  appointment 
by  the  Committee,  it  shall  cause  notice  of  such  appoint¬ 
ment  to  be  published  once  a  week  in  each  of  four  succes¬ 
sive  weeks  in  two  daily  newspapers  of  general  circulation 
published  in  said  Borough  of  Manhattan;  but  any  new 
trustee  so  appointed  by  the  Committee  shall  immediately 
and  without  further  act  be  superseded  by  a  trustee 
appointed,  in  the  manner  above  provided,  by  the  holders 
or  registered  owners  of  a  majority  in  principal  amount 
of  the  Notes  at  the  time  outstanding,  provided  that  such 
appointment  be  made  prior  to  the  expiration  of  one  year 
from  the  date  of  the  first  publication  of  such  notice. 
Until  a  new  Trustee  shall  be  appointed  by  a  majority  in 
principal  amount  of  the  noteholders  or  the  Committee, 
as  above  provided,  the  Company  shall  appoint  a  successor 
Trustee  by  an  instrument  executed  under  its  corporate 
seal  by  order  of  its  Board  of  Directors,  one  original 
whereof  shall  be  lodged  with  the  successor  trustee 
thereby  appointed  and  one  with  the  retiring  trustee,  but 
any  new  trustee  so  appointed  by  the  Company  shall  be 
immediately  and  without  further  act  superseded  by  a 
trustee  appointed  by  a  majority  in  amount  of  the  note¬ 
holders  or  by  the  Committee.  Notice  of  the  appointment 
of  any  successor  trustee  by  the  Company  shall  be  pub¬ 
lished  as  above  provided  in  case  of  the  appointment  by  the 
Committee. 


63 


Section  5.  Any  successor  trustee  appointed  hereunder 
shall  execute,  acknowledge  and  deliver  to  the  Company 
and  to  the  retiring  trustee  an  instrument  accepting  such 
appointment  hereunder,  and  thereupon  such  successor 
trustee,  without  any  further  act,  deed  or  conveyance, 
shall  become  vested  with  all  the  rights,  powers,  trusts, 
duties  and  obligations  of  its  predecessor  in  the  trusts 
hereunder,  with  like  effect  as  if  originally  named  as  trus¬ 
tee  hereunder;  but,  nevertheless,  on  the  written  request 
of  the  Company  or  of  the  successor  trustee,  the  trustee 
ceasing  to  act  shall  execute  and  deliver  an  instrument 
transferring  to  such  successor  trustee  upon  the  trusts 
herein  expressed  all  the  rights,  powers  and  trusts  of  the 
trustee  so  ceasing  to  act.  Upon  request  of  such  successor 
trustee,  the  Company  shall  execute  and  deliver  such 
instruments  as  may  reasonably  be  required  for  more  fully 
and  certainly  vesting  in  and  confirming  to  such  successor 
trustee  all  such  rights,  powers,  trusts,  duties  and  obliga¬ 
tions.  All  instruments  herein  provided  for  shall  be  at 
the  cost  of  the  Company. 

Section  6.  For  the  purpose  of  this  Article  Eight  the 
fact  of  the  holding  of  Notes  by  any  holder  and  the 
amounts  and  issue  numbers  of  such  Notes  and  the  date 
of  the  holding  of  the  same  may  be  proved  either  in  the 
manner  specified  in  Article  Ten  hereof  or  by  affidavits 
of  the  holders  thereof. 

Section  7.  Any  corporation  into  which  the  Trustee, 
or  any  successor  to  it  in  the  trusts  created  by  this  Inden¬ 
ture,  may  be  merged,  or  with  which  it,  or  any  such 
successor  to  it,  may  be  consolidated,  or  any  corporation 
resulting  from  any  merger  or  consolidation  to  which  the 
Trustee,  or  any  such  successor  to  it,  shall  be  a  party, 
provided  such  corporation  shall  be  a  corporation  organ- 


64 


ized  under  the  laws  of  the  State  of  New  York  or  under 
the  laws  of  the  United  States  and  shall  do  business  in  the 
Borough  of  Manhattan,  in  the  City  of  New  York,  shall  be 
the  successor  trustee  under  this  Indenture,  without  the 
execution  or  filing  of  any  paper  or  any  future  act  on  the 
part  of  any  of  the  parties  hereto,  anything  herein  to  the 
contrary  notwithstanding. 

Section  S.  The  term,  “the  Trustee,”  whenever  used 
in  this  Indenture,  means  the  trustee  for  the  time  being 
under  this  Indenture,  whether  original  or  successor. 

ARTICLE  NINE. 

Noteholders  Committee. 

Section  1.  A  Committee  (hereinbefore  and  herein¬ 
after  called  the  “Noteholders  Committee”  or  the  “Com¬ 
mittee”),  composed  of  E.  R.  Tinker,  Clement  R.  Ford  and 
Julius  Lichtenstein,  is  hereby  appointed.  Any  member  of 
such  Committee  may  resign  at  any  time  by  delivering  his 
written  resignation  to  the  Company  in  the  case  of  Julius 
Lichtenstein,  and  to  Chase  Securities  Corporation  of  the 
City  of  New  York,  in  the  case  of  E.  R.  Tinker  and  Clement 
R.  Ford.  In  case  of  any  vacancy  or  vacancies  in  such 
Committee  occurring  through  death,  resignation  or  other 
cause,  the  vacancy  or  vacancies  shall  be  filled  as  follows : 
Any  successor  to  Julius  Lichtenstein,  and  such  succes¬ 
sor's  successor  and  so  on  in  the  line  of  succession  shall 
be  chosen  by  the  Company  or  its  successor  or  successors. 
Any  successor  to  E.  R.  Tinker  and  such  successor's  suc¬ 
cessor  and  any  successor  to  Clement  R.  Ford  and  such 
successor’s  successor  and  so  on  in  the  line  of  succession 
shall  be  chosen  by  Chase  Securities  Corporation  of  the 
City  of  New  York,  or  its  successor  or  successors.  No 
member  of  the  Committee  shall  be  disqualified  to  assent 


65 


to  or  approve  of  any  transaction  because  of  the  fact  that 
he,  or  that  some  firm  of  which  he  is  a  member  or 
otherwise  connected  with  or  some  corporation  of  which 
he  is  an  officer  or  director  or  otherwise  connected  with, 
is  personally  interested  in  such  transaction.  The  mem¬ 
bers  of  the  Committee  and  of  any  firm  or  corporation 
with  which  any  of  them  may  at  any  time  be  associated 
may  from  time  to  time  purchase,  acquire,  hold,  own,  and 
deal  in  any  of  the  Notes  issued  hereunder,  and  have 
financial  or  other  relations  with  the  Company  of  any 
kind  to  the  same  extent  and  with  the  same  effect  as  if 
they  were  not  members  of  the  Committee.  The  Commit¬ 
tee  may  act  at  or  without  a  meeting.  From  time  to  time 
the  Committee  shall  give  notice  in  writing  to  the  Trustee 
of  each  and  every  succession  to  the  membership  of  the 
Committee  as  hereinabove  named,  and  in  the  absence  of 
receipt  of  such  notice  by  the  Trustee,  it  may  conclusively 
assume  that  the  personnel  of  the  Committee  has  not 
changed. 

Section  2.  The  Committee  shall  be  deemed  the  repre¬ 
sentative  of  the  noteholders,  and  any  action  taken  or 
assent  or  approval  given  by  it  in  accordance  with  the 
powers  vested  in  it  by  this  Indenture  shall  be  deemed  to 
be  the  action,  assent  or  approval  of  all  the  noteholders. 
The  Committee  shall  be,  and  it  is  hereby,  vested  with 
power : 

(a)  To  waive  in  any  instance  upon  such  terms,  con¬ 
ditions  and  agreements  as  it  may  prescribe  any  covenant 
or  agreement  by  the  Company  herein  contained  or  any  of 
the  terms,  provisions  and  conditions  herein  contained 
with  respect  to  the  form,  execution,  delivery,  registration 
and  exchange  of  Notes  and  the  remedies  of  the  Trustee, 
the  Committee  and  the  noteholders,  including  any  de¬ 
fault  or  event  of  default  of  the  Company  hereunder,  pro- 


66 


vided  that  the  Committee  shall  have  no  power  to  waive 
at  any  time  the  observance  by  the  Company  of  its  cove¬ 
nants  to  pay  the  principal  of  the  Notes  at  the  date  of 
maturity  expressed  therein,  and  the  coupons  and  claims 
for  interest  thereon,  or  respecting  the  conversion  of  the 
Notes  into  stock  or  the  non-declaration  or  non-payment 
of  dividends  on  the  common  stock  when  net  quick  assets 
are  not,  or  would  be  reduced  by  payment  of  any  such  divi- 
dent  below,  one  and  three-quarters  times  the  face  amount 
of  the  Notes  then  outstanding,  as  provided  in  this  In¬ 
denture,  but  the  Committee  shall  have  power  to  waive 
any  acceleration  of  maturity  of  the  Notes  and  interest 
thereon  as  herein  provided. 

(6)  To  determine  whether  or  not  any  action  contem¬ 
plated  or  taken  by  the  Company  would  be  or  is  in  viola¬ 
tion  of  the  terms  of  this  Indenture,  which  determination 
shall  be  binding  upon  all  the  noteholders  and  upon  the 
Trustee. 

(c)  To  modify,  waive  or  compromise  any  rights  of  the 
noteholders,  or  of  the  Committee,  against  the  Company, 
whether  such  rights  shall  arise  under  this  Indenture  or 
otherwise,  and  whether  enforcible  by  the  noteholders  or 
the  Committee  or  the  Trustee,  but  the  Committee  shall 
not  have  power  under  any  circumstances  to  vary  the 
amount  of  the  principal  or  interest  payable  upon  any 
Note  issued  hereunder,  or  the  time  or  place  of  payment  of 
said  principal  or  interest,  or  to  waive  the  payment  of 
principal  and  interest  when  due  by  the  terms  of  the  Notes, 
or  the  right  of  noteholders  to  convert  Notes  into  common 
stock,  or  a  breach  of  the  covenant  of  the  Company  as  to 
the  non-declaration  or  non-payment  of  dividends  on  com¬ 
mon  stock  when  the  ratio  herein  provided  is  not  main¬ 
tained  between  net  quick  assets  and  the  face  amount  of 
the  Notes,  except  as  herein  otherwise  provided. 


67 


Section  3.  Every  consent,  waiver,  approval,  direction 
or  action  of  the  Committee  shall  be  by  a  majority  of  the 
members  of  such  Committee  in  person  or  by  proxy,  and 
in  all  cases  where  action,  consent,  waiver  or  approval  of 
such  Committee  is  required  or  authorized  under  this  In¬ 
denture,  the  action,  waiver,  consent  or  approval  of  a 
majority  of  the  members  of  such  Committee  in  person  or 
by  proxy  shall  be  deemed  to  be  the  action,  consent  or  ap¬ 
proval  of  such  Committee.  The  Trustee  shall  be  entitled 
to  rely  upon  any  notice  of  change  in  the  membership  of 
the  Committee  given  to  the  Trustee  as  hereinabove  pro¬ 
vided  and  shall  not  be  required  to  take  or  be  deemed  to 
have  notice  of  any  such  change  or  addition  not  so  notified 
to  it.  Every  such  consent,  waiver,  approval,  direction  or 
action  of  the  Committee  on  the  basis  of  which  the  Trustee 
is  desired  to  rely,  or  which  shall  for  any  reason  be  certi¬ 
fied  to  the  Trustee  and  every  such  notice  of  change  in  the 
membership  of  the  Committee,  shall  be  in  writing  de¬ 
livered  to  the  Trustee  signed  in  person  or  by  proxy  by 
at  least  two  members  of  the  Committee,  or  otherwise,  as 
may  be  satisfactory  to  the  Trustee,  and  the  Trustee  with¬ 
out  further  inquiry  may  act  in  reliance  upon  any  con¬ 
sent,  waiver,  approval,  direction,  action,  notice  of  change 
or  other  writing  from  the  Committee,  so  signed. 

Section  4.  The  members  of  the  Committee,  their 
agents  or  proxies  shall  be  responsible  to  the  noteholders, 
to  the  Trustee,  and  to  the  Company  and  otherwise  only 
for  good  faith  in  the  performance  of  the  powers  and 
duties  conferred  and  imposed  upon  them  by  this  Inden¬ 
ture,  and  shall  under  no  circumstances  be  held  responsi¬ 
ble  to  any  one  for  any  mistake  in  judgment,  error  of  law, 
lack  of  diligence  or  unwise  exercise  of  their  powers  or 
discretion  or  for  any  thing  whatsoever  except  their  own 
individual  actual  wilful  fraud. 


68 


Section  5.  The  Committee  may  appoint  an  agent  or 
agents  (and  any  such  agent  may  in  the  discretion  of  the 
Committee  be  an  officer  of  the  Company)  with  power,  to 
the  extent  that  shall  be  provided  in  the  instrument 
appointing  such  agent  or  agents,  to  assent  to  or  approve 
any  transaction  in  behalf  of  such  Committee  upon  such 
terms,  conditions  and  agreements,  if  any,  as  shall  be 
determined  by  such  agent  or  by  the  Committee,  and  any 
such  assent  or  approval  given  by  any  such  agent  or 
agents,  within  the  scope  of  his  or  their  authority,  shall  be 
deemed  to  be  the  assent  or  approval  of  such  Committee. 
Each  member  of  the  ComnSittee  may  appoint  in  writing 
from  time  to  time  a  proxy  to  act  for  him  during  his  ab¬ 
sence  from  the  Borough  of  Manhattan,  City  of  New  York, 
N.  Y.  For  the  acts  and  neglects  of  such  agent  or  agents 
or  proxy  ( care  believed  by  the  Committee  or  the  member 
appointing  the  proxy  to  be  reasonable  having  been  exer¬ 
cised  in  his  or  their  selection)  neither  such  Committee 
nor  any  member  thereof  shall  incur  any  responsibility 
whatsoever.  The  Committee  may  employ  counsel,  ac¬ 
countants  and  other  agents  and  may  incur  such  expenses 
and  make  such  disbursements  in  connection  with  the  per¬ 
formance  of  its  duties  hereunder  as  it  may  consider 
reasonable,  and  the  Company  hereby  agrees  from  time  to 
time  to  pay  the  compensation  of  the  counsel,  accountants 
and  agents  of  the  Committee  and  its  expenses  and  dis¬ 
bursements  as  well  as  a  reasonable  compensation  to  the 
members  of  said  Committee. 

Section  6.  Any  consent,  waiver,  concession  or  other 
action  of  the  Committee  in  favor  of  the  Company  under 
any  of  the  provisions  hereof  in  any  instance  shall  not 
be  deemed,  unless  expressly  so  stated  by  the  Committee, 
to  relieve  the  Company  of  its  obligations  hereunder  in 
any  other  instance  or  to  operate  as  a  general  consent, 


69 


waiver,  concession  or  action  or  to  extend  or  to  apply  to 
any  other  instance  or  instances  whatsoever,  it  being  the 
intent  hereof  to  restrict  any  such  consent,  waiver,  con¬ 
cession  or  other  action  to  the  particular  instance  men¬ 
tioned  therein  or  covered  thereby  and  to  preclude  its 
extension  to  other  instances,  unless  the  Committee  ex¬ 
pressly  so  states.  No  delay  or  omission  of  the  Com¬ 
mittee  to  exercise  any  right  or  power  shall  impair  any 
such  right  or  power  or  shall  be  construed  to  be  a  waiver 
thereof  or  an  acquiescence  in  any  action  or  non-action 
of  the  Company. 

Section  7.  Unless  any  consent,  waiver,  concession 
or  other  action  claimed  at  any  time  by  the  Com¬ 
pany  to  have  been  given  or  taken  by  the  Committee  is 
evidenced  by  a  writing  signed  by  at  least  a  majority  of 
the  members  of  the  Committee,  the  Company  shall  not  be 
entitled  to  claim  or  plead  the  giving  of  any  such  consent, 
waiver  or  concession  or  the  taking  of  any  such  action  by 
the  Committee,  if  a  majority  of  the  members  of  the  Com¬ 
mittee  shall  then  be  unwilling  to  give  or  take  the  consent, 
waiver,  concession  or  action  and  if  one  of  the  majority 
of  the  members  of  the  Committee  claimed  to  have  thereto¬ 
fore  given  such  consent,  waiver  or  concession,  or  taken 
such  action  denies  that  he  did  so. 

Section  8.  The  Chase  Securities  Corporation  may  at 
any  time  in  its  discretion  without  responsibility  to  any 
one  cause  any  member  or  members  of  the  Committee 
appointed  by  it  or  whose  successors  it  shall  be  entitled 
to  appoint  to  resign,  aonrd  by  instrument  in  writing 
delivered  to  the  Trustee,  decline  to  appoint  any  successor 
or  successors  to  said  E.  R.  Tinker  or  Clement  R.  Ford, 
or  to  any  successor  to  either  of  them  as  hereinbefore 
provided,  and  Messrs.  Tucker,  Anthony  &  Company,  as 


70 


said  firm  may  then  be  constituted,  may  but  shall  be  under 
no  obligation  to,  appoint  any  member  or  members  which 
said  Chase  Securities  Corporation  shall  so  decline  to 
appoint  and  may  thereafter  appoint  their  successors  in 
like  manner  as  said  Chase  Securities  Corporation  is  en¬ 
titled  so  to  do  hereunder.  If  Messrs.  Tucker,  Anthony 
&  Company  declines  (as  it  shall  be  entitled  so  to  do)  or 
fails  for  any  reason  to  succeed  to  the  rights  of  appoint¬ 
ment  of  said  Chase  Securities  Corporation  hereunder,  or 
is  not  then  in  existence,  said  Securities  Corporation  may 
designate  any  corporation  or  firm  to  succeed  to  its  rights 
of  appointment  of  members  of  the  Committee  hereunder 
and  if  Messrs.  Tucker,  Anthony  &  Company,  after  ap¬ 
pointing  any  such  member  or  members  subsequently  de¬ 
clines  to  appoint  any  successor  or  successors  thereto  (as 
it  shall  be  entitled  to  do),  it  may  designate  a  corporation 
or  firm  to  succeed  to  its  rights  of  appointment  in  like 
manner,  and  any  corporation  or  firm  so  designated  by 
said  Chase  Securities  Corporation  or  Messrs.  Tucker, 
Anthony  &  Company  shall  in  turn  be  entitled  to  appoint 
a  corporation  or  firm  to  exercise  such  rights  of  appoint¬ 
ment  if  at  any  time  it  so  desires.  Neither  said  Chase 
Securities  Corporation  nor  Tucker,  Anthony  &  Company 
nor  any  one  so  succeeding  to  such  rights  of  appointment 
of  either  of  them  shall  be  responsible  to  any  one  (except 
for  its  own  actual  wilful  wrongdoing)  for  or  in  connec¬ 
tion  with  any  acts  or  neglects  of  any  member  or  members 
of  the  Committee  appointed  by  it  or  for  or  in  connection 
with  any  other  matter  or  thing.  No  such  designation 
of  any  corporation  or  firm  in  succession  to  Chase  Securi¬ 
ties  Corporation  or  Messrs.  Tucker,  Anthony  &  Company 
or  of  any  corporation  or  firm  which  may  be  designated 
as  successor  to  any  successor  of  either  of  them  or  other¬ 
wise  in  the  line  of  succession  shall  be  binding  upon  the 


71 


Trustee  unless  and  until  an  original  of  such  designation 
shall  have  been  lodged  with  it. 

ARTICLE  TEN. 

Noteholders’  Acts,  Holdings  and  Apparent 
Authority. 

Any  request  or  other  instrument  provided  by  this 
Indenture  to  be  signed  and  executed  by  holders  of  Notes 
may  be  in  any  number  of  concurrent  instruments  of  sim¬ 
ilar  tenor,  and  may  be  executed  by  such  holders  in  per¬ 
son,  or  by  an  agent  or  attorney  appointed  by  an  instru¬ 
ment  in  writing.  Proof  of  the  execution  of  any  such 
request  or  other  instrument,  or  of  a  writing  appointing 
any  such  agent  or  attorney,  or  of  the  holding  by  any 
person  of  Notes,  shall  be  sufficient  for  any  purpose  of 
this  Indenture,  and  shall  be  conclusive  in  favor  of  the 
Trustee  with  regard  to  any  action  taken  by  the  Trustee 
under  such  request  or  other  instrument  or  writing,  if 
made  in  the  following  manner,  viz. : 

(a)  The  fact  and  date  of  the  execution  by  any 
person  of  any  such  request  or  of  any  other  instru¬ 
ment  or  writing  may  be  proved  by  the  certificate 
of  any  notary  public  or  other  officer  authorized  to 
take,  either  within  or  without  the  State  of  New 
York,  acknowledgments  of  deeds  to  be  recorded  in 
New  York,  certifying  that  the  person  signing  such 
request  or  other  instrument  or  writing  acknowl¬ 
edged  to  him  the  execution  thereof;  or  by  the  affi¬ 
davit  of  a  witness  to  such  execution ; 

(&)  The  amount  of  coupon  Notes  not  regis¬ 
tered  as  to  principal  held  by  any  person  executing 
any  such  request  or  other  instrument  or  writing 
as  a  holder  of  Notes,  and  the  issue  numbers  of 


72 


the  Notes  held  by  such  person  and  the  date  of  his 
holding  the  same  (which  holding  the  Trustee  may 
conclusively  assume  to  have  continued  until  noti¬ 
fied  in  writing  to  the  contrary),  may  be  proved 
by  a  certificate  executed  by  any  trust  company, 
bank,  bankers  or  other  depositary  wheresoever 
situated  whose  certificate  shall  be  deemed  by  the 
Trustee  to  be  satisfactory,  showing  that,  at  the 
date  therein  mentioned,  such  person  had  on  deposit 
with  such  depositary,  or  exhibited  to  such  deposit¬ 
ary,  the  Notes  numbered  and  described  in  such 
certificate. 

The  ownership  of  Notes  registered  as  to  principal 
and  of  registered  Notes  without  coupons  shall  be  estab¬ 
lished  solely  by  the  registry  books  of  the  Company. 

ARTICLE  ELEVEN. 

Consolidation,  Merger  and  Sale. 

Section  1.  Nothing  in  this  Indenture  shall  prevent 
with  the  consent  of  the  Committee  the  consolidation  of 
the  Company  with  any  other  corporation,  or  the  merger 
into  the  Company  of  any  other  corporation  or  the  merger 
of  the  Company  into  any  other  corporation,  or  the  sale 
by  a  subsidiary  of  its  property  to  the  Company  or  to 
another  subsidiary,  or  the  sale  by  the  Company  of  its 
property  as  an  entirety,  provided  that  as  a  condition  of 
any  such  consolidation  or  such  merger  into  another  com¬ 
pany  or  of  any  sale  of  the  property  of  the  Company  as  an 
entirety  the  consolidated  corporation  or  the  corporation 
into  which  the  Company  is  merged  or  the  corporation  to 
which  such  property  shall  be  sold  as  an  entirety  shall 
assume  the  due  and  punctual  payment  of  the  principal 
of,  and  interest  on,  the  Notes  and  the  performance  of  the 


73 


covenants  of  this  Indenture,  and  shall  extend  to  the 
holders  or  registered  owners  of  the  Notes  secured  by  this 
Indenture,  the  right  and  privilege  to  convert  said  Notes 
into  its  common  stock  on  the  basis  of  the  conversion  rate, 
as  the  equivalent  and  in  substitution  for  the  common 
stock  of  the  Company  which  would  have  been  received 
upon  the  conversion  of  said  Notes  (except  for  such 
merger,  consolidation  or  sale),  the  ratio  of  substitution 
of  common  stock  of  such  successor  corporation  for  the 
common  stock  of  the  Company  to  be  the  same  as  the  ratio 
applicable  upon  such  merger,  consolidation  or  sale  to  the 
exchange  of  stock  of  such  successor  corporation  for  the 
common  stock  of  this  Company,  and  all  of  the  terms  and 
conditions  of  such  substitution  to  be  the  same  in  purpose 
and  effect  as  the  terms  and  conditions  of  such  exchange, 
all  whereof  must  be  satisfactory  to  the  Committee  in  its 
discretion. 

Section  2.  In  case  any  corporation  shall  be  consoli¬ 
dated  with  the  Company  as  aforesaid  or  in  case  the  Com¬ 
pany  shall  be  merged  into  any  other  corporation,  or  m 
case  of  the  sale  of  the  property  of  the  Company  as  an 
entirety,  the  corporation  formed  by  such  consolidation, 
or  into  which  the  Company  shall  have  been  merged,  or 
to  which  such  sale  shall  have  been  made,  shall  succeed 
to  and  be  substituted  for  the  Company,  with  the  same 
effect  as  if  it  had  been  named  herein  as  the  party  of  the 
first  part  hereto. 

Section  3.  For  every  purpose  of  this  Indenture,  in¬ 
cluding  the  execution  of  Notes,  the  term  “Company”  in¬ 
cludes  and  means,  not  only  American  Sumatra  Tobacco 
Company,  but  also  any  such  successor  corporation.  Every 
such  successor  corporation  shall  possess,  and  from  time 
to  time  may  exercise,  each  and  every  right  and  power 


74 


hereunder  of  American  Sumatra  Tobacco  Company,  in  its 
name  or  otherwise,  and  any  act  or  proceeding  by  any  pro¬ 
vision  of  this  Indenture  required  to  be  done  or  performed 
by  any  board,  committee  or  officer  of  the  Company  may  be 
done  and  performed  with  like  force  and  effect  by  the  like 
board,  committee  or  officer  of  any  corporation  that  shall 
at  the  time  be  such  lawful  successor  of  the  Company. 

Section  4.  Before  the  exercise  of  the  powers  con¬ 
ferred  by  this  Article  Eleven,  the  Company  or  any  such 
successor  corporation,  by  an  instrument  in  writing  exe¬ 
cuted  by  authority  of  two-thirds  of  its  board  of  directors 
and  delivered  to  the  Trustee,  may  surrender  any  of  the 
powers  reserved  to  the  Company  or  to  such  successor 
corporation;  and  thereupon  such  power  so  surrendered 
shall  terminate. 


ARTICLE  TWELVE. 

Cancellation  of  This  Indenture. 

Section  1.  If  all  the  Notes  issued  hereunder,  both 
principal  and  interest,  shall  be  well  and  truly  paid,  or 
converted  into  common  stock  of  the  Company  pursuant 
to  the  provisions  of  Article  Six  hereof,  at  the  times  and 
in  the  manner  therein  and  herein  expressed,  according 
to  the  tenor  and  effect  thereof,  this  Indenture  shall  cease 
and  determine,  and  upon  proof  being  given  to  the  reason¬ 
able  satisfaction  of  the  Trustee  that  all  the  Notes  and 
coupons  have  been  paid  or  satisfied,  and  upon  payment 
of  the  costs,  charges  and  expenses  incurred  by  the  Trus¬ 
tee  in  relation  thereto,  the  Trustee  shall  cancel  this 
Indenture. 

Section  2.  In  case  any  of  the  Notes  or  coupons  issued 
hereunder  shall  not  be  presented  for  payment  when  the 


75 


principal  thereof  shall  be  due  and  payable,  the  Company 
may  at  any  time  thereafter  pay  to  the  Trustee  for  the 
benefit  of  the  holder  or  holders  thereof  the  amount  of 
said  Notes  and  coupons,  and  thereupon  the  Trustee 
shall  cancel  this  Indenture  in  the  same  manner  as 
if  said  Notes  and  coupons  had  been  paid.  And  the 
certificate  of  the  President  or  Treasurer  of  the  Company, 
or  of  such  other  officer  thereof  as  the  Trustee  shall  think 
proper,  that  certain  Notes  and  coupons  in  such  certificate 
specified  have  not  been  presented  for  payment,  shall  be 
sufficient  evidence  of  that  fact  to  authorize  the  Trustee 
to  act  under  the  powers  contained  in  this  Section  2. 
Neither  the  Company  nor  the  Trustee  shall  be  required 
to  pay  interest  on  any  moneys  deposited  with  the  Trus¬ 
tee  as  aforesaid;  and  any  such  moneys  remaining  un¬ 
claimed  by  the  holders  of  Notes  and  coupons  for  six 
years  after  the  date  of  such  deposit  with  the  Trustee  shall 
be  paid  by  the  Trustee  to  the  Company;  provided, 
however,  that  the  Trustee,  before  being  required  to  make 
any  such  payments,  may,  at  the  expense  of  the  Company, 
cause  notice  that  said  moneys  have  not  been  so  called  for 
and  that  after  a  date  named  therein  they  will  be  returned 
to  the  Company  to  be  published  once  a  week  in  each  of 
four  successive  weeks  in  a  daily  newspaper  of  general  cir¬ 
culation  published  in  the  Borough  of  Manhattan,  in  the 
City  of  New  York. 

This  Indenture  may  be  executed  in  several  counter¬ 
parts,  each  of  which  shall  be,  and  shall  be  deemed  to  be, 
an  original  instrument. 

In  witness  whereof,  said  American  Sumatra  Tobacco 
Company  has  caused  this  Indenture  to  be  signed  in  its 
corporate  name  by  its  President  or  one  of  its  Vice-Presi¬ 
dents  and  its  corporate  seal  to  be  hereunto  affixed  and 


76 


to  be  attested  by  its  Secretary  or  one  of  its  Assistant 
Secretaries,  and  The  Chase  National  Bank  of  the  City  of 
New  York,  in  token  of  its  acceptance  of  this  trust,  has 
caused  this  Indenture  to  be  signed  in  its  corporate  name 
by  one  of  its  Vice-Presidents  and  its  corporate  seal  to  be 
hereunto  affixed  and  to  be  attested  by  its  Cashier  or  one 
of  its  Assistant  Cashiers,  all  as  of  the  day  and  year  first 
above  written. 

American  Sumatra  Tobacco  Company, 

(S.)  By  F.  M.  Arguimbau 
Vice-President. 

Attest : 

(S.)  Louis  Leopold 

Assist  ant  S  ec  ret  ary . 

[seal] 


Tiie  Chase  National  Bank  of  the  City 
of  New  York, 

(S.)  By  Reeve  Schley 

Vice-President. 


Attest : 


(S.) 


[seal] 


E.  H.  Lee 

Assistant  Cashier. 


77 


State  of  New  York.) 

'  ^  0202  * 

County  of  New  York,  j  ‘ 

On  this  16 tli  day  of  June,  in  the  year  1920,  before 
me  personally  came  F.  M.  Arguimbau,  to  me  known, 
who,  being  by  me  duly  sworn,  did  depose  and  sav  that 
he  resides  in  Freeport,  in  the  State  of  New  York;  that 
lie  is  a  Vice-President  of  American  Sumatra  Tobacco 
Company,  one  of  the  corporations  described  in  and  which 
executed  the  foregoing  instrument  ;  that  he  knows  the 
seal  of  said  corporation ;  that  the  seal  affixed  to  said 
instrument  is  such  corporate  seal ;  that  it  was  so  affixed 
by  order  of  the  board  of  directors  of  said  corporation ; 
and  that  he  signed  his  name  thereto  by  like  order. 


W.  H.  Young 

Notary  Public,  Westchester  County 
Certificate  filed  in  N.  Y.  County 
New  York  County  Clerk’s  No.  5 
New  York  County  Register’s  No.  1106. 
My  term  expires  March  30,  1921. 

[seal] 


State  of  New  York.)  -  - 

County  of  New  York,f 

On  the  16th  day  of  June,  in  the  year  1920,  before 
me  personally  came  Reeve  Schley,  to  me  known,  who 
being  by  me  duly  sworn,  did  depose  and  say  that  he 
resides  in  New  York  City,  in  the  State  of  New  York; 
that  lie  is  a  Vice-President  of  The  Chase  National  Rank 
of  the  City  of  New  York,  one  of  the  corporations  described 
in  and  which  executed  the  foregoing  instrument;  that  he 
knows  the  seal  of  said  corporation ;  that  the  seal  affixed 
to  said  instrument  is  such  corporate  seal ;  that  it  was  so 
affixed  by  order  of  the  board  of  directors  of  said  corpora¬ 
tion  ;  and  that  he  signed  his  name  thereto  by  like  order. 

W.  H.  Young 

Notary  Public,  Westchester  County 
Certificate  filed  in  N.  Y.  County 
New  York  County  Clerk’s  No.  5 
New  York  County  Register’s  No.  1106. 
My  term  expires  March  30,  1921. 

[seal] 


El  198 


UNIVERSITY  OF  ILLINOIS-URBANA 


3  0112  105646589 


8 


